U.S. GDP contracted in the first quarter, recording -0.3%
The core PCE price index for the first quarter in the U.S. was 3.5%, higher than the expected 3.3%
Both sets of data are 'bearish' for the crypto market. Some may argue that negative GDP gives the Federal Reserve a reason to cut rates quickly, but Powell has consistently stated that he is only responsible for inflation. Therefore, this set of inflation data clearly does not provide sufficient justification for a rate cut in May.
What about June? It still depends on the specific economic indicators in May.
Moreover, it’s possible that there may not be a rate cut in June either. After all, is the U.S. debt crisis really unsolvable in the short term? Not necessarily!
The U.S. can continue to use short-term high-interest debt to repay medium- and long-term U.S. debt. Furthermore, a corresponding crisis occurred in 2023, and it has experience in resolving it. The U.S. might have already prepared the funds to repay this massive short-term debt of $36 trillion that is due in June, but it’s just not public! On the surface, it seems that Trump and the Federal Reserve are at odds, but in reality, the decision not to cut rates is because this will be the last card to play; there’s no need to reveal it unless necessary. Additionally, even if rates are cut, it can only be considered a stopgap for the economic situation in the U.S.
Tariffs have not been fully implemented yet, but it has already come to this. What must come will eventually come. With a negative GDP figure, we are no longer talking about expectations of a recession in the U.S. economy, but rather the fact of a recession. The path for the U.S. has become increasingly narrow, so cherish what remains... The mid-term outlook for the crypto market remains bearish
