Crypto:
30188
Bitcoin:
$69.171
% 3.48
BTC Dominance:
%54.4
% 0.13
Market Cap:
$2.44 T
% 3.67
Fear & Greed:
74 / 100
Bitcoin:
$ 69.171
BTC Dominance:
% 54.4
Market Cap:
$2.44 T

Bitcoin Drops Below $63K as US Data Fuels Market Sell-Off

Bitcoin

Bitcoin and US stock futures plunged on Thursday afternoon following the release of mixed US economic data, including GDP and the core PCE price index. The data raised concerns about the Federal Reserve’s ability to tame inflation, leading to a risk-off sentiment in the market.

Core PCE Price Index Exceeds Expectations

The core PCE price index, a key inflation gauge closely monitored by the Fed, came in higher than expected for the first quarter of 2024. The index rose to 3.7%, exceeding the forecast of 3.4%. This increase in inflation pressures raised concerns about the Fed’s ability to achieve its 2% inflation target.

Bitcoin, which had been trading above $64,000 earlier in the day, reacted sharply to the higher-than-expected PCE data. The price of the world’s largest cryptocurrency plummeted by over $4,000 in the past 48 hours, falling below $63,000 for the first time since March.

US Stock Markets Follow Suit

US stock futures also fell in response to the economic data. S&P 500 futures were down 1.35%, Nasdaq futures were down 2.15%, and Dow Jones futures were down 1.42%. The sell-off extended into the regular trading session, with all three major US stock indices closing down significantly.

Fed’s Rate Hike Timing in Question

The mixed economic data has cast doubt on the timing of the Fed’s next rate hike. While the lower-than-expected GDP growth suggests that the economy may be slowing down, the higher-than-expected inflation data indicates that the Fed may need to act more aggressively to combat inflation.

According to the CME FedWatch Tool, which uses futures contract prices to predict short-term interest rates, the Fed is most likely to hike rates in November. The tool suggests that the Fed has ruled out rate cuts in June, July, and September, with August and October being non-meeting months.

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