Cryptocurrency-linked exchange-traded funds (ETFs) are trading higher. At the time of writing, MBC Ethereum (03425) is up 3.43%, quoted at HK$3.314. Bosera Ethereum (03009) has gained 3.06%, trading at HK$1.346. Harvest Bitcoin (03439) has increased by 2.12%, reaching HK$7.725.

The broader cryptocurrency market has shown strength since July, with Bitcoin briefly reclaiming the $63,000 level and Ethereum rebounding above $1,700. This positive momentum follows recent comments and data that have eased expectations for further interest rate hikes by the Federal Reserve. Federal Reserve Governor Waller stated that inflation risks have diminished, and inflation expectations over the past four weeks have declined. Additionally, US non-farm payrolls for June showed an increase of just 57,000 jobs, significantly missing expectations, with substantial downward revisions to the April and May data. These factors combined have substantially moderated market expectations for Fed rate hikes.

According to the CME FedWatch Tool, the probability of a Federal Reserve interest rate cut in September has fallen to around 50%. Furthermore, the market-implied expectation for the total number of rate hikes by year-end has also decreased to less than 1.5.