Analysis: Renewed stagflation fears weigh on Bitcoin

The growing threat of stagflation—a combination of low growth and high inflation—is negatively impacting the price of Bitcoin, according to an analysis by CryptoSlate. The report noted that flash U.S. March Purchasing Managers' Index (PMI) data released on March 24 suggested this possibility. While the Manufacturing PMI rose from 51.6 to 52.4, the Services PMI, which accounts for a large portion of the U.S. economy, fell from 51.7 to 51.1. CryptoSlate suggested the rise in manufacturing PMI is a sign of tension rather than typical strength, as companies increase purchases in advance to cope with supply and cost hikes stemming from the conflict in the Middle East. "In this situation, the likelihood of a rate cut by the U.S. Federal Reserve decreases, which usually has a negative impact on risk assets like Bitcoin," the analysis stated.