PRICE STUDY AHEAD OF A FED UPDATE
Trading slightly around $85,600, Bitcoin (BTC) surged on Tuesday, up 1.5% for the day, as investors prepared for the upcoming address by Fed Chair Jerome Powell. Markets are looking for signals that the Fed may consider a rate cut sooner than expected as inflation rises and recession concerns grow.
Conventional markets also show promise. While cryptocurrency-related stocks like Coinbase (up 1.4% at $178) benefited from investor enthusiasm, the S&P 500 and Nasdaq both rose by about 1%.
Inflation expectations are soaring; labor market prospects are darkening; supported Bitcoin?
The March consumer expectations survey data from the New York Fed shows alarming trends:
Rising to 3.6%, one-year inflation forecasts are the highest since mid-2023.
Stable at 3.0%, the three-year outlook reflects residual caution.
Five-year forecasts have only dropped to 2.9%.
Source: New York Fed Consumer Expectations Survey
Concerns about the employment situation are also rapidly increasing:
The most negative result since April 2020—44% of Americans believe the unemployment rate will increase over the next year.
Fifteen percent believe they could lose their job in the next twelve months.
This fear is significantly rising among those earning less than $50,000, suggesting increasing financial stress.
A new high since October 2023, thirty percent of consumers believe their financial situation will deteriorate.
These figures complicate the Fed's balance. While inflation remains a concern, rising unemployment forces the central bank to consider a rate cut sooner than expected. The case for Bitcoin and other distributed assets strengthens with this shift in expectations.
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