As someone who closely follows the cryptocurrency market, I’ve seen my fair share of ups and downs. But Thursday’s events were particularly noteworthy. The U.S. government’s preliminary report showing weaker first-quarter GDP growth and higher inflation than anticipated was a one-two punch that sent shockwaves through the market.
On Thursday for a short period, the price of Bitcoin (BTC) dipped under $63,000 due to other cryptocurrencies experiencing a downturn, instigated by newly released data indicating a slower first-quarter economic expansion and heightened inflation rates in the United States.
Based on the initial U.S. government report for the first quarter, I observed a disappointing GDP growth rate of only 1.6%. This falls significantly short of analysts’ predictions of 2.5% expansion. Furthermore, it represents a noticeable decline from the robust 3.4% growth recorded in the final quarter of 2023.
During that period, the GDP price index surprised us by rising from 1.6% in the last quarter to 3.1%. In simpler terms, the increase in the GDP price index was greater than expected, going from 1.6% to 3.1%.
Following the release of a disappointing inflation report, investor optimism took a turn for the worse. This development diminished the hopes for rate reductions in the current year, triggering a wave of selling in higher-risk financial instruments worldwide.
The opening of the S&P 500 and Nasdaq markets saw a decrease of almost 2%, while the 10-year U.S. Treasury bond yield increased by 8 basis points, reaching a high of 4.73% – its peak since November.
I’ve noticed an intriguing shift in the cryptocurrency market lately. Bitcoin took a dip, dropping over 4% to touch a low of $62,800. Meanwhile, Ether (ETH) experienced the same 4% decrease and settled around $3,100 during this period.
The declines of Solana (SOL), Avalanche (AVAX), and Aptos (APT), which function as the native currencies for their respective layer-1 networks, caused a more substantial drop in the prices of other major altcoins, amounting to around 8%-9%. However, some partial recoveries have since occurred.
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2024-04-25 20:04