๐—ง๐—ต๐—ถ๐˜€ ๐—ข๐—ป๐—ฒ ๐—ง๐—ต๐—ถ๐—ป๐—ด ๐—–๐—ผ๐˜‚๐—น๐—ฑ ๐—–๐—ฟ๐—ฎ๐˜€๐—ต ๐—•๐—ถ๐˜๐—ฐ๐—ผ๐—ถ๐—ป ๐—”๐—ป๐—ฑ ๐—–๐—ฟ๐˜†๐—ฝ๐˜๐—ผ ๐—œ๐—ป ๐—ง๐—ต๐—ฒ ๐—–๐—ผ๐—บ๐—ถ๐—ป๐—ด ๐— ๐—ผ๐—ป๐˜๐—ต๐˜€ย 

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Reason ๐Ÿ‘‡

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โ—พ Fear of stagflation

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Recently, US GDP data came in at 1.6%, which was almost 40% less than expectations.ย 

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On the other hand, US core PCE rose from 2% to 3.7% (an almost 85% increase).

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This indicates a weakening economy with rising inflation, also called stagflation.ย 

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Why is it bad?

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During a weakening economy, the FED usually makes rate cuts to boost the economy.ย 

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During rising inflation, the FED usually does rate hikes to control the inflation.ย 

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But right now, the FED is clueless, as both things are happening at the same time.

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During the stagflation era of 1970โ€“80, stocks were one of the worst performers.ย 

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Given that crypto usually follows stocks, if the stock market takes a big hit, Bitcoin and crypto will dump even more.

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The next FOMC meeting is in 4 days, which will decide the fate of the market in the coming months.

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