Financial markets exhibited a risk-on attitude early on Monday during Asian trading hours, fueled by reports suggesting that the upcoming tariffs set to be imposed on April 2 could be more nuanced than initially anticipated.
Bitcoin (BTC), the leading digital currency by market capitalization, was trading around $86,500, reflecting a 2.7% increase over the past 24 hours, while Solana’s SOL token saw an almost 6% rise to $138, according to the latest data.
XRP, focused on payments, recorded a 2.5% gain, reaching $2.44 and maintaining a position above its 50-day simple moving average (SMA) after two weeks of positive price trends.
Futures for the S&P 500, Dow Jones Industrial Average, and Nasdaq climbed by over 0.5% during the session, as Wall Street’s fear gauge, the VIX index, dipped 2.5% to 18.88 points. Meanwhile, markets in China reversed earlier losses.
Improved sentiment followed media reports over the weekend indicating that President Donald Trump’s anticipated “reciprocal tariffs” set for April 2 might be more targeted than the broad-based measures previously threatened.
Some nations may receive exemptions, and pre-existing tariffs on steel and other metals might not accumulate, as outlined in reports.
Trump’s tariffs had unsettled the market sentiment back in February, causing both equities and cryptocurrencies to decline, with BTC dropping nearly 17.6% to below $80,000. Last week, the Federal Reserve updated its inflation forecast upward while lowering its growth projections, likely reflecting the impact of Trump’s assertive trade strategies.
The Fed has characterized the inflationary effects from tariffs as transitory while maintaining predictions for two interest rate cuts this year, a dovish stance that favors risk assets, including cryptocurrencies.
This Fed action, combined with the possibility of reduced tariffs, has rekindled a bullish sentiment in the market.
“I bet $BTC will reach $110k before it retests $76.5k. Why? The Fed is shifting from QT to QE for treasuries, and tariffs are irrelevant due to ‘transitory inflation.’ JAYPOW told me so,” noted Arthur Hayes, co-founder of BitMEX and currently chief investment officer at Maelstrom, on social media.
Key developments to monitor in the forthcoming days include Friday’s PCE reading, which is the Fed’s preferred measure of inflation, as well as the scheduled appearances of SEC nominee Paul Atkins and Comptroller of the Currency nominee Jonathan Gould before the Senate Banking Committee on March 27.