Crypto Outpaces Stocks on Signs of Softer Fed Policy
Signs of a cooling U.S. economy are shifting expectations around monetary policy—and crypto markets are starting to react.
Recent data showing a contraction in GDP and a continued slowdown in inflation has fueled speculation that the Federal Reserve may soon adopt a more accommodative stance. Analysts believe that if rate cuts arrive, Bitcoin could emerge as one of the biggest beneficiaries.
The latest inflation figures, particularly the Fed’s preferred metric—the Core PCE index—showed no growth month-over-month and declined to 2.6% annually, its lowest level in over a year.
Combined with a surprise GDP pullback, the data suggests weakening economic momentum and progress toward the Fed’s 2% inflation goal.
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Bitcoin responded with strength, climbing past $97,000 and rallying over 13% since the start of its recent rebound—dubbed “Independence Day” by some crypto traders.
Meanwhile, the S&P 500 has remained mostly flat over the same period, underlining the asset class divergence.
With the odds of multiple rate cuts rising, analysts say capital could increasingly shift into alternative assets. Bitcoin, often seen as a hedge against fiat devaluation and tightening monetary cycles, may gain from renewed liquidity while equities face pressure from economic deceleration.
Alexander Stefanov
Reporter at Coindoo
Alex is an experienced finance journalist and a cryptocurrency and blockchain enthusiast. With over 8 years of experience covering the crypto, blockchain and fintech industries, he deeply understands the complex and constantly evolving world of digital assets. His insightful and thought-provoking articles provide readers with a clear picture of the latest developments and trends in the market. His passionate approach allows him to break down complex ideas into accessible and insightful content. Follow up on his content to be up to date with the most important trends and topics.
