Markets could soon test Treasury Secretary Scott Bessent’s efforts to push down yields on longer-dated US government debt.
Philadelphia Fed Manufacturing Activity Hits More Than 10-Year High
The Philadelphia Fed’s Manufacturing Business Outlook Survey surged to 47.4 in August, reaching its highest point in more than a decade.
The July reading came in at a robust 41.4, while economists had expected the gauge to retreat to 25 as the World Cup-related boost faded.
The prices-paid index fell 13 points to 40.9, signaling a moderation in input-cost pressures.
US initial jobless claims also remained near historically low levels, dropping to 206,000 last week from 212,000 previously. The reading contrasts with recent nonfarm payrolls figures, which have indicated some deterioration in labor-market conditions.
Treasury yields continued their upward move, with the 10-year yield rising 4 basis points to 4.69%.
Bitcoin Slips After Touching $72,000
Bitcoin pulled back to roughly $71,500 on Thursday after reaching a high of $72,344 earlier in the session. Despite the dip, BTC remained about 11% higher on the day, based on CoinDesk data.
The decline was modest following Bitcoin’s break above $72,000 during European trading, which pushed its market capitalization beyond $1.4 trillion.
Crypto continued to diverge from traditional equities. US stock futures were mostly weaker before the opening bell as higher Treasury yields pressured the Dow, S&P 500 and Nasdaq. Walmart shares also declined after the retailer released its latest results.
Treasury Yields Recover After Bessent’s Bond-Buyback Move
Treasury Secretary Scott Bessent’s department surprised markets Wednesday by announcing plans to substantially increase buybacks of longer-term government bonds.
Expectations that the move could function like a form of stealth quantitative easing sent the 30-year Treasury yield down 10 basis points, helping spark the crypto rally that carried into Thursday. Bitcoin subsequently reached $72,000 for the first time since early June.
The move may provide temporary relief, but bringing down long-term interest rates sustainably could require more than a single intervention from the Treasury.
Yields were already recovering much of Wednesday’s decline. Roughly 90 minutes before the US stock market opened, the 30-year yield had risen 5 basis points to 5.24%, reversing about half of its previous-day decline.
The 10-year yield also moved back above 4.70%, while the two-year yield climbed to 4.195% after dropping to 4.12% on Wednesday.
Bitcoin Targets First Positive August Since 2021
Bitcoin is heading toward its first monthly gain for August since 2021, with BTC up roughly 15% so far this month. The cryptocurrency has finished each of the previous four Augusts lower.
Bitcoin is also on pace for its first quarterly increase since Q3 2025, with the asset gaining about 23% during the current quarter.
Still, more than a week remains in August, while September has historically been Bitcoin’s weakest month, producing an average decline of about 3%.
BTC was trading just below $72,000.
Dollar Weakness Could Strengthen Bitcoin’s Momentum
The US Dollar Index, or DXY, has declined 3% since the end of July and currently stands near 98.6.
DXY slipped below its 200-day moving average on Wednesday after Bessent announced the Treasury’s bond-buyback plans.
If the dollar remains below the 200-day average, currently around 99.1, it could provide additional support for risk assets such as Bitcoin, which was hovering near $72,000.
Bitcoin Rally Wipes Out $243M in Shorts Within an Hour
Bitcoin’s breakout above $69,000 triggered roughly $243 million in short liquidations within an hour, according to CoinGlass, as bearish traders were forced to exit losing positions.
Shorts represented almost all of the $252 million in liquidations, while long traders accounted for approximately $9 million.
Bitcoin was responsible for around $220 million of the liquidations, with Ether contributing another $11 million.
Leveraged positions are automatically closed when losses reach an exchange’s liquidation threshold. When short positions are forced to close, traders must buy back the asset, potentially adding further upward momentum.
Total crypto liquidations reached $3.26 billion over 24 hours, with shorts making up $1.2 billion of the $1.31 billion liquidated over the preceding 12 hours.
Bitcoin Climbs to $71,000
Bitcoin reached $71,000, gaining more than 2.5% in the previous 24 hours and approximately 12% over the past seven days.
RBI Signals Potential Rate Hike as Inflation Concerns Grow
India’s Reserve Bank surprised investors with a more hawkish stance, indicating that it could raise interest rates later this year and pushing local bond yields higher.
Minutes from the RBI’s August meeting showed policymakers becoming more concerned about inflation. Deputy Governor Poonam Gupta raised the possibility of a rate hike, while external members pointed to a potential need to adjust monetary policy.
The shift could have wider implications for crypto markets because India represents one of the world’s largest crypto user bases. Tighter domestic financial conditions could affect local trading activity and strengthen the rupee backdrop.
The RBI’s stance also stands apart from the broader global trend, with expectations for a softer US Federal Reserve policy and strong crypto ETF inflows helping Bitcoin move above $69,000.
China’s AI Push Drives Attention Toward Star 50
China’s technology-focused Star 50 Index has become a key market indicator as the country accelerates spending on artificial intelligence and semiconductor self-sufficiency.
Technology companies make up about 86% of the index, which has outperformed the broader CSI 300 by roughly 30% this year.
The index offers another view into the global AI investment cycle, which has also powered semiconductor stocks that have broadly moved alongside crypto markets this year.
Bitcoin and Ether ETFs Pull In $706M as Rally Gains Momentum
US spot Bitcoin ETFs attracted $517 million on Aug. 19, marking their biggest daily inflow since early May. Ether ETFs recorded another $189 million, their strongest inflow since October 2025, according to SoSoValue.
The combined flows provide further evidence of renewed demand behind Bitcoin’s move above $69,000 and Ethereum’s 18% surge toward $2,250.
The inflows come after months of relatively muted Bitcoin trading below $64,000, during which ETF demand gradually improved. The latest numbers suggest that returning institutional interest could be helping drive the breakout.
XRP and Solana ETFs also recorded smaller inflows, while Hyperliquid’s product posted the only outflow, losing roughly $2 million.
The sharp rally caused major losses for short sellers, with bearish crypto positions recording a record $2.7 billion in liquidations as Bitcoin approached $70,000.
The next test for the rally will be whether ETF inflows remain strong. A single day of large purchases supports the breakout but is not enough to confirm that the move is sustainable.
Continued buying over the next several sessions could signal that sustained institutional demand is returning after being largely absent since spring. Conversely, a reversal in flows could put the $64,000 area back on traders’ radar as an important support zone.
