Bitcoin price continued to rise on Friday This was as traders reacted to the latest US inflation data. At the time of writing this article, $BTC The price was trading around $73,800, up nearly 5% in the past 24 hours.
Much of the price increase occurred after U.S. Treasury Secretary comments scott bessan. He said the administration is taking steps to curb the rise in oil prices.
This move follows a break above the $71,800 resistance level observed earlier this week. Market participants are now focused on whether Bitcoin can maintain its momentum towards higher technology levels.
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Several analysts pointed out the following: Possibly short term Based on the Fibonacci retracement level, the target is around $75,400. Some technical traders noted that the broader market structure has not yet confirmed a long-term bottom.
Tara, a crypto analyst at PrecisionTrade, writes about X:$BTC It just broke through the $71.8,000 resistance level, so it is likely targeting the missed $75.4,000 area. ”
PCE inflation data shows sustained price pressures
New economic data released by the US Department of Commerce showed that inflation remains strong. The personal consumption expenditure price index rose 0.3% in January.
The core PCE index, which excludes food and energy, rose 0.4%. On an annual basis, core PCE reached 3.1%. The Fed is monitoring this measure closely as it guides its 2% inflation target. The latest data showed that inflation remains above target.
Personal consumption also increased by 0.4% in January. Economists surveyed had expected a modest 0.3% increase. Spending accounts for more than two-thirds of U.S. economic activity. However, other indicators showed that business investment and overall growth momentum was weakening.
Core capital goods orders remained unchanged throughout the month. Shipments of these products decreased by 0.1%.
Concerns about economic slowdown emerge as prices rise
Revised economic data also showed a slowdown in growth in the fourth quarter. Gross domestic product expanded at an annual rate of 0.7%.
Previous forecasts had predicted a growth rate of around 1.4%. The slowdown followed strong growth of 4.4% recorded in the third quarter.
Rising energy prices are putting further pressure on the economy. Since the Middle East conflict began, the retail price of gasoline has increased more than 20% to about $3.60 per gallon.
Economists are now warning that economic activity could slow in the coming months due to rising costs and weak exports. Kathy Bojancic, chief economist at Nationwide, said inflation could rise while growth slows.
“We are seeing a sharp rise in inflation and a slowdown in economic activity in the second quarter,” he said.
Will the Fed keep interest rates unchanged?
Financial markets now expect the Federal Reserve to maintain policy. interest rate Stable in the short term. The central bank’s benchmark interest rate currently stands at 3.50-3.75%.
Many economists believe the Fed will maintain this range at its next policy meeting. Futures markets are currently pricing in just one potential rate cut this year.
September seems to be the most likely time for policy easing. Sustained inflation reduces the likelihood of early interest rate cuts. However, US President Donald Trump called for an emergency rate cut from the Federal Reserve. In a post on Truth Social, he called on Fed Chairman Jerome Powell to cut interest rates immediately without waiting for the next meeting.
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The next Federal Open Market Committee meeting will be held next week. But data from CME FedWatch shows there is a 99.2% chance the Fed will leave interest rates unchanged.
