News

Bitcoin Breaks Lower As US GDP Slows To 1.6%, Hints At Hot PCE Inflation

The Bitcoin price declined after the sluggish U.S. Gross Domestic Product (GDP) grew at 1.6% in Q1 and looming inflation concerns have dampened the sentiment of the market.
Published by
Bitcoin Breaks Lower As US GDP Slows To 1.6%, Hints At Hot PCE Inflation

Highlights

  • US GDP disappoints with 1.6% growth, sparking fears of economic weakness and inflation.
  • Core PCE Price Index surges to 3.7%, intensifying concerns over inflationary pressures.
  • Bitcoin slumps amid growing concerns over the Fed's hawkish stance.

Bitcoin and the broader financial markets faced a downturn as the United States’ Gross Domestic Product (GDP) revealed sluggish growth in the first quarter of 2024, casting a shadow on investor confidence. With the first quarter GDP figures falling short of expectations at a 1.6% annualized pace, concerns about inflationary pressures loom large, amplifying market volatility.

Advertisement

US GDP Grows 1.6% In Q1

The latest data from the Bureau of Economic Analysis paints a somber picture of the US economy, with first-quarter U.S. GDP growth clocking in at a modest 1.6%, well below the anticipated 2.5%. A commentary by The Kobeissi Letter underscored the severity of the situation, highlighting a worrying juxtaposition of weakening economic growth and surging inflation. 

Meanwhile, the Core PCE Price Index witnessed a substantial jump from 2.0% to 3.7%, far surpassing estimates, while the PCE inflation data surged from 1.8% to 3.4%, stoking fears of an impending hawkish stance from the Federal Reserve.

Amid that, investor sentiment took a hit as concerns over escalating inflation and lackluster economic performance weighed heavily on cryptocurrency prices. Despite ongoing market sell-offs preceding the GDP release, the dismal data exacerbated the downward trajectory. 

In addition, with expectations of a delayed rate cut by the Fed, recent gains in Bitcoin and other cryptocurrencies were swiftly wiped out, signaling a challenging road ahead for digital asset markets.

Also Read: Bitcoin Bulls Scale Back Leveraged Bets, Post-Halving Demand Cools

Advertisement

What’s Next?

Following the gloomy GDP data, the U.S. 10-year Bond Yield rose 1.89% to $4.743, while the U.S. Dollar Index Futures noted a surge of 0.10% to $105.795. Meanwhile, the gloomy data along with the hotter-than-anticipated inflation data for the first quarter suggests a further delay in the Fed’s rate cut decision.

The Federal Reserve has maintained a hawkish stance lately while hinting at a potential delay in their rate cut plans. Amid this, the recent data has further dampened the investors’ sentiment, as the inflation still remained higher despite the higher policy rates.

Meanwhile, following the GDP data, the Bitcoin price fell 4.53% to $63,091.65, with its trading volume soaring 43.75% to $34.67 billion. Amid the recent selloff, market experts have warned of a further slump in the BTC price.

Notably, the dip in the BTC price also triggered a broader crypto market crash. As of writing, the global crypto market cap fell 4.85% to $2.33 trillion.

Also Read: How Is Bitcoin Halving Adjusting The Market?

Advertisement

Share
Rupam Roy

Rupam is a seasoned professional with three years of experience in the financial market, where he has developed a reputation as a meticulous research analyst and insightful journalist. He thrives on exploring the dynamic nuances of the financial landscape. Currently serving as a sub-editor at Coingape, Rupam's expertise extends beyond conventional boundaries. His role involves breaking stories, analyzing AI-related developments, providing real-time updates on the crypto market, and presenting insightful economic news. Rupam's career is characterized by a deep passion for unraveling the complexities of finance and delivering impactful stories that resonate with a diverse audience.

Published by
Why trust CoinGape: CoinGape has covered the cryptocurrency industry since 2017, aiming to provide informative insights to our readers. Our journalists and analysts bring years of experience in market analysis and blockchain technology to ensure factual accuracy and balanced reporting. By following our Editorial Policy, our writers verify every source, fact-check each story, rely on reputable sources, and attribute quotes and media correctly. We also follow a rigorous Review Methodology when evaluating exchanges and tools. From emerging blockchain projects and coin launches to industry events and technical developments, we cover all facets of the digital asset space with unwavering commitment to timely, relevant information.
Investment disclaimer: The content reflects the author’s personal views and current market conditions. Please conduct your own research before investing in cryptocurrencies, as neither the author nor the publication is responsible for any financial losses.
Ad Disclosure: This site may feature sponsored content and affiliate links. All advertisements are clearly labeled, and ad partners have no influence over our editorial content.

Recent Posts

  • News

Will Bitcoin Rally as JPMorgan Tips Fed To End QT at FOMC Meeting?

Bitcoin traders are turning their attention to this week’s Federal Open Market Committee (FOMC) meeting.…

October 26, 2025
  • News

White House Crypto Czar Backs Michael Selig as ‘Excellent Choice’ To Lead CFTC

White House crypto czar David Sacks has shown his support for Donald Trump's nomination of…

October 25, 2025
  • News

Ripple Explores New XRP Use Cases as Brad Garlinghouse Reaffirms Token’s ‘Central’ Role

Crypto firm Ripple has revealed that it is exploring new ways to use XRP within…

October 25, 2025
  • News

Kyrgyzstan Adds Binance Coin (BNB) to National Crypto Reserve, CZ Confirms

Kyrgyzstan has made a significant move in the adoption of digital finance. It has now…

October 25, 2025
  • News

Ripple-Backed Evernorth Grows XRP Treasury to $1B Ahead of Nasdaq Listing

Ripple-backed Evernorth's XRP treasury has grown to $1 billion just days after the company announced…

October 25, 2025
  • News

Trump Tariff Tensions Ease as U.S. and China Hold Positive Trade Talks Ahead of Oct 30 Summit

In fresh developments, the United States and China’s trade teams have commenced negotiations on the…

October 25, 2025