April's Personal Consumption Expenditures report showed headline PCE inflation running at 3.8% year-over-year, its fastest pace in two years and nearly double the Federal Reserve's 2% target, complicating the outlook for rate cuts that risk assets like Bitcoin depend on. Core PCE held steady at 3.3%, its highest reading since October 2023, though the monthly core figure came in at 0.2%, slightly below the 0.3% economists had forecast. The persistently elevated annual readings reinforce the Fed's reluctance to ease monetary policy, leaving Bitcoin caught between sticky inflation that can act as a long-term tailwind and a high-rate environment that suppresses near-term risk appetite. Until inflation cools convincingly toward target, the Fed has little room to pivot.
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