Following the key interest rate cut announced by the US Fed Reserve last week, the Chinese Central Bank’s (PBOC) governor made an announcement about similar steps to be taken by China.
Many crypto influencers and financial experts on the X social media platform (famous as Twitter until 2023) now believe that this Chinese rate cut is likely to confirm Bitcoin bullish curve in the near future and fuel its further growth.
China confirms interest rate slash, will this benefit Bitcoin?
Today, the head of the Bank of China Pan Gongsheng stated that PBOC will cut the 7-day repo rate by 0.2 percentage points. Aside from that, the governor said that the reserve requirement ratio (RRR) for local banks will see a decrease by 50 basis points.
The governor did not indicate any more or less exact timing for implementing those supportive economic measures, but he assured the attendees of the press conference that it would certainly happen within the short term.
He added that depending on further conditions of the economy, the central bank may add another cut of 0.25 or 0.5 basis points by the end of the year.
Markets in China had been expecting a much smaller rate cut, namely 10 basis points. The chief economist for greater China ING, Lynn Song, called this “a slightly stronger than expected move.”
Angel investor, entrepreneur and Bitcoin supporter Anthony Pompliano commented on that strategic move of the PBOC, saying that he would expect a large inflow of cheap capital into the markets after the Chinese rate cut: “Cheap capital is going to flood the market from around the world.” He added that: “Asset prices are going to be large beneficiaries.”
Acropolis co-founder Mason Carter commented on that, saying that he expects Bitcoin to surpass other assets in the market.
And Bitcoin is the fastest horse
— Mason Carter (@onchaincowboy) September 24, 2024
Many Bitcoin enthusiasts on X also believe that China will support Bitcoin price further surge by implementing the interest rate cut.
🇨🇳 China announces to cut rates.
HERE WE GO #BITCOIN 🚀 pic.twitter.com/POdMr2TRSp
— Vivek⚡️ (@Vivek4real_) September 24, 2024
Bitcoin market performance
Over the past week, since the Fed announcement, the world’s pioneer cryptocurrency Bitcoin has printed a substantial increase of 7.51% until today. On that path at some point, it topped the $64,000 level.
At the time of this writing, Bitcoin is changing hands at $63,875 after a marginal drop faced earlier today.