Bitcoin Price Slips as US Treasury Yields Surge Past 5%

Bitcoin‘s price declined on Wednesday, coinciding with a sharp rise in U.S. Treasury yields to multi-year highs and a Treasury Department debt buyback announcement.

The price of Bitcoin was down approximately 2% over a 24-hour period, trading around $84,357. This followed a recent rally that had pushed the price near $87,330 earlier in the week, fueled by investor inflows into spot ETFs.

The 10-year Treasury yield climbed above 5% for the first time since 2007. The move followed stronger-than-expected flash PMI data for September, which pushed a composite index to a five-year high. Inflationary pressures also intensified, with input costs across manufacturing and services reaching their highest level since October 2022.

Analysts note that rising yields typically act as a headwind for Bitcoin, as higher returns on safe government bonds increase the opportunity cost of holding a non-yielding asset. Higher rates also tend to strengthen the U.S. dollar and dampen risk appetite. Bitcoin’s price dropped further on Wednesday afternoon following the U.S. Treasury’s announcement that it will purchase up to $6 billion of longer-dated debt on Thursday.