The US economy’s growth rate for the fourth quarter of 2025 has been adjusted down to a mere 0.7%, a significant drop from the previously reported figure of 1.4%. Core PCE inflation remained steady at 3.1% as of January.
According to CME FedWatch, there is over a 92% likelihood that the Federal Reserve will maintain current interest rates during its upcoming FOMC meeting on March 17-18.
Currently, Bitcoin is trading at $73,537, reflecting an increase of 4.42% for the day.
The recent adjustment in GDP figures highlights a troubling trend in the US economy, with growth plummeting from Q3’s robust pace of 4.4% to just 0.7% in Q4—a change attributed to declining exports, reduced consumer services spending, government expenditure cuts, and lower investment levels. The government shutdown experienced in October and November alone contributed approximately one percentage point to this downturn.
The annual GDP for all of 2025 was revised downwards to show only a growth rate of around 2.1%. Meanwhile, inflation remains stubbornly high; February’s Consumer Price Index (CPI) came in at exactly what analysts expected—2.4%. This morning’s confirmation from the Bureau of Economic Analysis indicated that core PCE held steady at an elevated level of 3.1%, significantly above the Fed’s target rate of just two percent—making it difficult for them to consider lowering interest rates amidst persistent price pressures even as economic expansion slows dramatically.
This dual challenge—sluggish economic growth coupled with persistent inflation—is fueling discussions around “stagflation” predictions for the year ahead.
Market Expectations
As we approach this pivotal FOMC meeting date, data indicates an overwhelming probability (99.2%) that interest rates will remain unchanged within their current range between350-375 basis points—a situation many seem prepared for.
However, uncertainty looms regarding future actions following this meeting; these revised GDP numbers are altering expectations about when potential rate cuts might occur leading traders everywhere to reassess their strategies accordingly.
The Focus on Bitcoin
Traditionally speaking; reductions in Fed interest rates tend to benefit Bitcoin significantly since lower borrowing costs encourage investors towards riskier assets while simultaneously weakening dollar strength and increasing demand for alternatives outside conventional finance systems altogether—the longer they delay action amid faltering economic conditions only strengthens arguments favoring eventual cuts down-the-line!
This resilience is reflected today as Bitcoin trades up by over four percent despite downward trends seen across equity markets amidst ongoing geopolitical tensions involving Israel-Iran relations alongside weak domestic performance overall!
A Look Ahead
No immediate changes are anticipated during March’s meetings but given how quickly things have shifted recently—from Q4 reporting now showing just seven-tenths percent growth—it raises questions not merely about whether or not we’ll see reductions come into play sometime next year but rather precisely when those decisions may be made!
If such actions do take place? You can bet all eyes will be firmly fixed upon Bitcoin!
You may also find it intriguing: Is there finally some decoupling happening? Why cryptocurrencies have risen by more than two-and-a-half percent while stock indices struggle today?