Bitcoin Experiences Stability Amid Slow US Economic Growth

Bitcoin Experiences Stability Amid Slow US Economic Growth

By: Eva Baxter

Latest Market Update

According to data from Trading Economics, the United States economy observed a slower growth at an annualized rate of 1.6% in Q1 2024. This falls short of the predicted 2.5% and decelerates from the previous quarter's 3.4% surge. Meanwhile, the inflation continues to surge beyond the target level, creating an overheated economic environment.

Following this economic data, the US bond yields grew with the 2-year Treasury yield going beyond 5%. The front end of the yield curve, especially the 3-month and 6-month yields, are now around 5.4%. The market doesn't seem to anticipate any rate cuts for a minimum of six months with the current federal funds rate standing at 5.25% to 5.5%.

The CME FedWatch tool indicates that investors do not expect any rate cuts until July, followed by one in September, and a pause for the rest of the year. This prediction is a significant shift from the outset of 2024 when the markets had predicted about six rate cuts.

Amid this economic climate, Bitcoin (BTC) trades at approximately $63,300 while the US equity markets have seen a decline of over 1%.

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