U.S. Macro Data Sparks Market Divergence Across Assets
The Nasdaq 100 surged to a new all-time high on Friday, diverging sharply from traditional safe-haven assets like gold and Bitcoin, both of which came under pressure following the release of disappointing U.S. macroeconomic data.
Inflation and Spending Data Miss Expectations
While the data released reflects economic conditions from May, it has still shaken investor sentiment due to its implications for monetary policy and inflation. Key data points included:
- Core PCE inflation (the Federal Reserve’s preferred inflation measure) rose 0.2% in May, ahead of the 0.1% expected.
- Year-over-year core PCE came in at 2.7%, slightly above the 2.6% forecast.
- Personal income declined by -0.4%, missing estimates of a 0.3% increase.
- Personal spending also fell -0.1%, compared to an expected +0.1%.
These figures reinforce the growing fears of stagflation — a scenario where economic growth slows while inflation remains elevated.
Bitcoin Stuck in Consolidation Range
Bitcoin (BTC) was trading around $107,000, with little change on the day, continuing to consolidate between $102,000 and $108,000. Despite ongoing ETF inflows and long-term bullish sentiment, Bitcoin has struggled to maintain upward momentum amid mixed macroeconomic signals.
The lack of direction is attributed to investor uncertainty, especially around how the Federal Reserve may respond to persistent inflation with its rate policy.
Gold Falls 2%, Now 7% Below Record High
Gold, typically a hedge against inflation, surprisingly dropped 2%, currently sitting 7% below its all-time high. The decline came even as the U.S. dollar index weakened — a move that would normally support gold prices.
Analysts like Peter Schiff argue that markets are missing the bigger picture. According to Schiff:
“Stagflation and a tanking dollar are bullish for gold, regardless of any superficial trade deals ‘negotiated’ by Trump.”
His comments highlight the disconnect between gold’s current price action and its historical role as a defensive asset during economic uncertainty.
Nasdaq 100 Surges Amid AI-Led Optimism
In stark contrast to crypto and commodities, the Nasdaq 100 has broken into new record territory, driven by tech sector gains, particularly AI-related stocks and strong earnings. Despite weaker economic data, investors appear confident that rate cuts could be on the horizon, boosting equity valuations.
Outlook: Will Stagflation Fuel Rotation to Hard Assets?
With inflation creeping higher and consumer data faltering, investors may soon reassess their allocations. While tech stocks continue to lead in the short term, ongoing inflation and weakening fundamentals could revive demand for Bitcoin and gold.
Markets may be ignoring warning signs — but smart money is watching inflation, growth, and central bank rhetoric closely.
Disclaimer
This content is for informational purposes only and does not constitute financial, investment, or legal advice. Cryptocurrency trading involves risk and may result in financial loss.