#PCEMarketWatch
Bitcoin (BTC) and Ethereum (ETH) dropped 1% and 2.5%, respectively, on Friday following President Donald Trump's statement that China violated its trade agreement with the United States (US). This comes amid the release of the US Personal Consumption Expenditure (PCE) data, which came in line with expectations.
Bitcoin, Ethereum fail to recover despite in-line PCE data; Trump sparks weekend tariff fears again
The US core PCE data for April came in line with expectations at 2.5% YoY, its lowest level since March 2021, dropping from 2.7% the previous month. The overall annual PCE fell 2.1%, below expectations of 2.2%. On a monthly basis, both core and overall PCE rose by 0.1%.
The PCE is the Federal Reserve's (Fed) preferred tool for measuring inflation. Market participants suggest that the Fed could maintain a wait-and-see approach to cutting rates, considering the PCE came in line with market expectations.
The crypto market initially held steady following the in-line PCE data but plunged quickly after signs of another weekend tariff uncertainty from Trump emerged, a trend that has been developing since the weekend tariff announcement on Canada and Mexico in February.
The decline was fueled by a post from President Donald Trump stating that China violated its trade agreement with the US. Trump shared on Truth Social that his 145% tariffs imposed on China were devastating and put them in "grave economic danger." He said that the effects on China caused him to make a "fast deal" to prevent civil unrest in the country, which quickly stabilized China's economy.
"The bad news is that China, perhaps not surprisingly to some, HAS TOTALLY VIOLATED ITS AGREEMENT WITH US. So much for being Mr. NICE GUY!," wrote Trump.
This caused a wider shaking across crypto assets, with Bitcoin plummeting below $105,000 for the first time since May 20, down 1% on the day and 3.7% on the weekly timeframe. Likewise, top altcoins Ethereum, XRP and Solana also declined by 4%, 4.8% and 5.8%, respectively, over the past 24 hours.