$BTC Fed Uncertainty and PCE Expectations Keep Cryptocurrency Markets on Alert

But, despite the ceasefire between Israel and Iran, risk appetite was suppressed by the growing uncertainty about the Fed's independence and its plans for interest rate cuts.

President Donald Trump maintained his personal attacks against Fed Chairman Jerome Powell while demanding that he cut interest rates immediately.

Trump's attacks came amid reports that the president may expedite the selection of Powell's successor, which could potentially undermine the Fed chairman as he fulfills the remainder of his term until May 2026.

Powell largely ignored Trump's calls for lower rates and stated that caution regarding the inflationary effects of Trump's trade tariffs would prevent the Fed from acting in the short term. In this regard, the PCE price index data, the Fed's preferred inflation indicator, is expected to be released on Friday and should show that price pressures have increased slightly in May.

The core PCE data is also expected to rise further above the Fed's annual target of 2%.

The anticipation of the data left risk-driven markets cautious on Friday. Cryptocurrencies are particularly vulnerable to changes in rate expectations, as the sector typically benefits from a low-interest environment.