Market Updates

Is BTC’s rally over? Powell and inflation could end it

Published: Apr 21, 2025

Inflation is surging, with expectations hitting 4%, while Philly Fed new orders have plunged 30%. The FED is under pressure—will they pivot, or stay the course? The next few weeks could change everything.

In this update:

Powell's Speech.

Weaker Data.

Rising Inflation Over the Coming Months Could Lead to A Hard Trump Pivot.

On-Chain Data Suggests There's Room for Lower Price.

Disclaimer: This is not financial or investment advice. You are responsible for any capital-related decisions you make, and only you are accountable for the results.

Powell's speech

On Wednesday, FED Chair J Powell spoke at the Economic Club of Chicago. Powell struck a more hawkish stance than markets were perhaps expecting. The markets seemed to be looking for Powell to say that there was a 'FED Put' if something in the markets began to break. However, Powell suggested that there wasn't, and that markets are seemingly acting in a functional way despite the overall level of uncertainty.

Powell also said that "for the time being, we (the FED) are well positioned to wait for greater clarity before considering any adjustments to our policy stance". The markets sold off on this as it suggested there isn't a chance of FED rate cuts anytime soon, at the May or June FED Meetings.

This is since the tariffs and their overall level of uncertainty will likely result in an economic slowdown (which we're already starting to see - see the next section), which will likely see both Unemployment and inflation rise.

Powell even mentioned this, saying, "I do think we'll be moving away from these goals" - that's the FED's dual mandate of stable inflation and maximum employment.

To add to this, other FED members have struck a similar tone to Powell, which is that the FED should remain on pause until there is more clarity around tariffs.

What's next?

With inflation expectations climbing to over 4% in the coming months and Philly Fed new orders plummeting by 30%, how soon will the FED act, and what could this mean for market volatility in the weeks ahead?

Weaker data

Recently, we've been watching the 'soft' data (which is a lot of the survey data) to see if the weakness we've seen in that begins showing up in the harder data. And yesterday, we began to see that.

Philly Fed New Orders fell off a cliff yesterday, showing that manufacturers have cut down on their number of orders and slowed down.$BTC #FederalReserveIndependence