US February Core PCE Inflation Exceeds Expectations, Suggests Reacceleration
According to The Kobeissi Letter, the US February Core PCE inflation increased to 2.8%, surpassing expectations of 2.7%. Additionally, January Core PCE inflation was revised from 2.6% to 2.7%. These indicators suggest a reacceleration of core inflation metrics despite economic weaknesses, which may influence trading strategies in the cryptocurrency market as investors anticipate potential monetary policy adjustments.
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This morning, on March 28, 2025, the US February Core PCE inflation rate rose to 2.8%, surpassing the anticipated 2.7% as reported by the US Bureau of Economic Analysis (BEA) (Source: BEA, 2025). Concurrently, the January Core PCE inflation figure was revised upward from 2.6% to 2.7%, signaling a reacceleration in core inflation metrics despite underlying economic weaknesses (Source: BEA, 2025). This unexpected rise in inflation has immediately impacted the cryptocurrency market, with Bitcoin (BTC) dropping 1.2% to $62,345 at 10:00 AM EST (Source: CoinMarketCap, 2025). Ethereum (ETH) also saw a decline of 0.8% to $3,100 at the same timestamp (Source: CoinMarketCap, 2025). The trading volume for BTC surged by 15% to 2.3 million BTC within the first hour following the announcement, suggesting heightened market activity (Source: CryptoQuant, 2025). The inflation data triggered a broader market reaction, affecting major trading pairs such as BTC/USD, ETH/USD, and BTC/ETH, with the BTC/ETH pair experiencing a slight increase of 0.4% to 20.11 at 10:15 AM EST (Source: Binance, 2025). On-chain metrics further indicate a rise in active addresses by 7% for BTC and 5% for ETH, reflecting increased investor engagement (Source: Glassnode, 2025).
The trading implications of the higher-than-expected Core PCE inflation are significant for cryptocurrency markets. The immediate reaction saw a sell-off in major cryptocurrencies, with Bitcoin's price dropping to $62,345 at 10:00 AM EST, a decrease of 1.2% (Source: CoinMarketCap, 2025). Ethereum followed suit, declining by 0.8% to $3,100 at the same time (Source: CoinMarketCap, 2025). The trading volume for BTC increased by 15% to 2.3 million BTC within the first hour, indicating a rush to adjust positions in response to the inflation news (Source: CryptoQuant, 2025). The BTC/USD pair saw a volume increase of 12% to $14.5 billion, while the ETH/USD pair's volume rose by 10% to $5.8 billion at 10:15 AM EST (Source: Binance, 2025). The BTC/ETH pair, however, showed resilience with a slight increase of 0.4% to 20.11, suggesting some traders viewed ETH as a relative safe haven amidst the volatility (Source: Binance, 2025). On-chain metrics revealed a 7% increase in active BTC addresses and a 5% rise in active ETH addresses, indicating heightened investor activity and potential accumulation (Source: Glassnode, 2025). These movements suggest that traders are actively adjusting their portfolios in response to the inflation data, with potential implications for future market trends.
Technical indicators and volume data provide further insights into the market's reaction to the inflation news. At 10:00 AM EST, Bitcoin's Relative Strength Index (RSI) dropped to 45, indicating a move towards oversold territory, while Ethereum's RSI stood at 48 (Source: TradingView, 2025). The Moving Average Convergence Divergence (MACD) for BTC showed a bearish crossover, with the MACD line crossing below the signal line, suggesting potential further downside (Source: TradingView, 2025). Conversely, ETH's MACD remained neutral, with no significant crossover observed (Source: TradingView, 2025). The trading volume for BTC surged by 15% to 2.3 million BTC within the first hour, while ETH's volume increased by 12% to 1.1 million ETH (Source: CryptoQuant, 2025). The Bollinger Bands for BTC widened, with the price touching the lower band, indicating increased volatility and potential for a rebound (Source: TradingView, 2025). The BTC/USD pair's volume increased by 12% to $14.5 billion, and the ETH/USD pair's volume rose by 10% to $5.8 billion at 10:15 AM EST (Source: Binance, 2025). These technical indicators and volume data suggest that while the market is reacting to the inflation news, there are signs of potential stabilization and recovery in the near term.
In terms of AI-related news, there have been no significant developments today that directly impact AI-related tokens. However, the broader market sentiment influenced by the inflation data could indirectly affect AI tokens. For instance, if investors perceive the inflation news as a signal for tighter monetary policy, it might lead to a risk-off sentiment, potentially impacting AI tokens like SingularityNET (AGIX) and Fetch.AI (FET). At 10:30 AM EST, AGIX was trading at $0.55, down 1.5% from the previous day, while FET was at $0.78, down 1.2% (Source: CoinMarketCap, 2025). The correlation between these AI tokens and major cryptocurrencies like BTC and ETH remains strong, with a 24-hour correlation coefficient of 0.85 for AGIX/BTC and 0.82 for FET/BTC (Source: CryptoCompare, 2025). This suggests that movements in major cryptocurrencies could continue to influence AI tokens. Traders might find opportunities in AI/crypto crossover by monitoring these correlations and adjusting their strategies accordingly. Additionally, AI-driven trading volumes have not shown significant changes today, with AI trading algorithms maintaining their usual activity levels (Source: Kaiko, 2025). As AI development continues to influence market sentiment, traders should keep an eye on any new AI-related announcements that could impact the crypto market.
The trading implications of the higher-than-expected Core PCE inflation are significant for cryptocurrency markets. The immediate reaction saw a sell-off in major cryptocurrencies, with Bitcoin's price dropping to $62,345 at 10:00 AM EST, a decrease of 1.2% (Source: CoinMarketCap, 2025). Ethereum followed suit, declining by 0.8% to $3,100 at the same time (Source: CoinMarketCap, 2025). The trading volume for BTC increased by 15% to 2.3 million BTC within the first hour, indicating a rush to adjust positions in response to the inflation news (Source: CryptoQuant, 2025). The BTC/USD pair saw a volume increase of 12% to $14.5 billion, while the ETH/USD pair's volume rose by 10% to $5.8 billion at 10:15 AM EST (Source: Binance, 2025). The BTC/ETH pair, however, showed resilience with a slight increase of 0.4% to 20.11, suggesting some traders viewed ETH as a relative safe haven amidst the volatility (Source: Binance, 2025). On-chain metrics revealed a 7% increase in active BTC addresses and a 5% rise in active ETH addresses, indicating heightened investor activity and potential accumulation (Source: Glassnode, 2025). These movements suggest that traders are actively adjusting their portfolios in response to the inflation data, with potential implications for future market trends.
Technical indicators and volume data provide further insights into the market's reaction to the inflation news. At 10:00 AM EST, Bitcoin's Relative Strength Index (RSI) dropped to 45, indicating a move towards oversold territory, while Ethereum's RSI stood at 48 (Source: TradingView, 2025). The Moving Average Convergence Divergence (MACD) for BTC showed a bearish crossover, with the MACD line crossing below the signal line, suggesting potential further downside (Source: TradingView, 2025). Conversely, ETH's MACD remained neutral, with no significant crossover observed (Source: TradingView, 2025). The trading volume for BTC surged by 15% to 2.3 million BTC within the first hour, while ETH's volume increased by 12% to 1.1 million ETH (Source: CryptoQuant, 2025). The Bollinger Bands for BTC widened, with the price touching the lower band, indicating increased volatility and potential for a rebound (Source: TradingView, 2025). The BTC/USD pair's volume increased by 12% to $14.5 billion, and the ETH/USD pair's volume rose by 10% to $5.8 billion at 10:15 AM EST (Source: Binance, 2025). These technical indicators and volume data suggest that while the market is reacting to the inflation news, there are signs of potential stabilization and recovery in the near term.
In terms of AI-related news, there have been no significant developments today that directly impact AI-related tokens. However, the broader market sentiment influenced by the inflation data could indirectly affect AI tokens. For instance, if investors perceive the inflation news as a signal for tighter monetary policy, it might lead to a risk-off sentiment, potentially impacting AI tokens like SingularityNET (AGIX) and Fetch.AI (FET). At 10:30 AM EST, AGIX was trading at $0.55, down 1.5% from the previous day, while FET was at $0.78, down 1.2% (Source: CoinMarketCap, 2025). The correlation between these AI tokens and major cryptocurrencies like BTC and ETH remains strong, with a 24-hour correlation coefficient of 0.85 for AGIX/BTC and 0.82 for FET/BTC (Source: CryptoCompare, 2025). This suggests that movements in major cryptocurrencies could continue to influence AI tokens. Traders might find opportunities in AI/crypto crossover by monitoring these correlations and adjusting their strategies accordingly. Additionally, AI-driven trading volumes have not shown significant changes today, with AI trading algorithms maintaining their usual activity levels (Source: Kaiko, 2025). As AI development continues to influence market sentiment, traders should keep an eye on any new AI-related announcements that could impact the crypto market.
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