Bitcoin Faces Uncertainty as Tariffs and Interest Rates Weigh on Markets

Trade tensions and monetary policy are shaping the outlook for both crypto and traditional markets, with uncertainty likely to persist in the coming weeks.

While Bitcoin has struggled, shedding over 17% since January 20, analysts suggest that a resolution to tariff disputes could trigger the next major market movement.

Nansen research analyst Nicolai Sondergaard believes the standoff over trade policies is keeping risk assets under pressure. He suggests that the real turning point will come after April 2, when key decisions on tariffs could shift market sentiment. Whether negotiations lead to tariff reductions or further escalation will determine the next major trend.

Beyond trade concerns, the Federal Reserve’s stance on interest rates remains a significant factor. Investors are closely watching for signs of a policy shift, but according to Sondergaard, the central bank is unlikely to cut rates until economic conditions weaken further.

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Market data from the CME Group suggests that an overwhelming majority expect rates to remain unchanged at the Fed’s next meeting in May. However, Iliya Kalchev of Nexo points out that stabilizing inflation and improving economic conditions could set the stage for renewed confidence in digital assets.

Key reports, including GDP figures, jobless claims, and inflation data, will provide further clues on whether rate cuts are on the horizon. If economic indicators align in favor of easing policies, risk assets—including Bitcoin—could see a resurgence.

Alexander Zdravkov