Bitcoin Struggles to Regain Ground Amid Yen Carry-Unwind Fears — Market Talk
Bitcoin struggles to regain ground in early Asian trading, after suffering its biggest one-day drop since March overnight. Cryptocurrencies and other risk assets have been hit by worries that a potential Bank of Japan rate hike could unwind yen-funded carry trades, prompting investors to start reversing positions, CIMB analysts say. Such trades involve borrowing yen at low rates to convert into higher-yielding assets. The yen strengthened following what some perceive as a hawkish tilt by BOJ Gov. Kazuo Ueda, with swap markets now pricing in 82% odds of a 25 bp rate increase this month versus 23% a week earlier, the analysts write in a note. Bitcoin and Ethereum are both 0.1% lower at $86,356 and $2,789, respectively. ([email protected])