The weaker than expected US economic performance and easing inflation data will revive more enormous Federal Reserve hopes, with analysts predicting that Bitcoin (BTC) will earn more profits than stocks in the coming months.
Analysts say US GDP contraction and lower inflation boost hope for a Fed cut
The US economy signed for the first time in three years, and the Fed’s preferred inflation gauge, Core Personal Consumption Expenses (PCE), was flat in recent months. Core PCE fell from 3.0% to 2.6% per year, reinforcing the narrative that inflation is slowly easing towards the central bank’s 2% target.
Bitcoin leads recovery
Following the release of the data, Bitcoin has surged beyond $97,000, winning more than 13% since “Independence Day,” the iconic term for a new rally among crypto investors.
In contrast, the S&P 500 has earned less than 1% in the last 30 days, highlighting the growing differences between digital assets and traditional stock markets.
“As inflation moves towards the Fed’s 2% target, expectations for multiple interest rate cuts are strengthening, leading to a new wave of liquidity injections, which could benefit alternative risk assets like crypto over equities.
*This is not investment advice.