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HomeNewsBusinessPositive Economic Data Are Not Good For Bitcoin Bulls

Positive Economic Data Are Not Good For Bitcoin Bulls

When traders in traditional finance and cryptocurrencies were eager to bid 2022 farewell, a dose of stronger-than-expected economic data may have dampened the mood for asset prices once more.

Thus, the narrative has abruptly changed as a result of statistics provided on Thursday that suggested the economy might still be humming along. The largest one-day decline in three months occurred in the key U.S. stock index, Standard & Poor’s 500, which fell 2.8%. According to the CoinDesk Bitcoin Price Index, the price of Bitcoin (BTC) has decreased 1.1% during the last 24 hours.

At the risk of appearing ridiculously apparent, inflation continues to hang over the heads of all major economies. The Federal Reserve and other major central banks, who may have been the single biggest source of downward pressure on asset prices all year, eased off on their push to tighten monetary policy as economic data worsened and predictions of a U.S. recession in 2023 increased. This was the gallows mentality of the markets.

Everyone is affected by inflation, which is a problem and a major reason why the Fed is unlikely to let off. Whether buying bitcoin, stocks, or any other type of financial instrument, the choice to do so is typically yours. The choice to acquire household products, energy, and food is not.

This tax isn’t expected to go down anytime soon, according to the economic figures announced on Thursday.

Owners of those assets are typically burdened by asset price declines. Price increases as a whole have the effect of a flat tax on almost everyone.

Initial unemployment claims: The 216,000 initial unemployment claims were less than the 225,000 anticipated. Additionally, continuing unemployment claims were higher than anticipated.

Although initially this seems to be excellent news, Jerome Powell, the chairman of the Federal Reserve, has stressed that the labour market needs to “soften.”
The Fed believes there is an imbalance between supply and demand on the labour market. The stronger-than-expected report enhances the likelihood that the Fed will maintain trying to reduce total job growth in order to restrain pay rises.

Top-performing hedge fund manager David Tepper told CNBC on Thursday that he “tends to believe” the Fed when it says it will take a certain action. GDP: The third-quarter growth of the US economy was raised up from the 2.9% estimate reported on November 30 to 3.2%. This belongs in the “good news is bad news” category as well. In order to stop price hikes, the Federal Reserve would probably prefer to view a reduction in growth as a necessary evil. Consumer spending growth was a major factor in the expansion, which will cause prices to rise.

GDP Price Index (GDP Price Deflator): The third-quarter increase in the U.S. GDP price index to a record high was 4.4%. The GDP Price Deflator differs from the consumer price index in that it is intended to track changes in prices for all final products and services. In contrast, the CPI tracks changes in the cost of a “basket of products.” The Deflator is frequently seen as a more thorough examination of price rises. Its rise to a record high is probably going against everything the Federal Reserve wants to happen.

News Summary:

  • Positive Economic Data Are Not Good For Bitcoin Bulls
  • Check all news and articles from the latest Business news updates.
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