The U.S. manufacturing PMI unexpectedly expanded, and the probability of an interest rate cut in June was once less than 50%. Risk assets such as Bitcoin fell in response.

According to data released today, the U.S. Manufacturing Purchasing Managers Index (PMI) in March exceeded market expectations and rose by 2.5 to 50.3, expanding for the first time since November 2022 and halting 16 consecutive months of contraction.

The increase in manufacturing activity may indicate that the overall U.S. economy is expanding and is regarded by the Federal Reserve as a signal of economic strength, which in turn affects its expectations for future economic prospects. Generally speaking, if the PMI is better than expected, the Fed is more likely to be inclined to maintain the current interest rate policy or consider raising interest rates, especially if other economic indicators also support the trend of economic growth and rising inflation.

According to FedWatch data, market expectations for a rate cut in June were once below 50% and have risen to 57% at the time of writing this article, indicating that the market's confidence in the Fed's interest rate cut in June seems to be shaken.

The U.S. dollar index remained strong on the news, rising nearly 0.5% on the day, while the three major U.S. stock indexes opened lower. At the same time, cryptocurrencies such as Bitcoin were not immune as risk assets, with Bitcoin falling below $69,000 and Ethereum falling below $3,500 in the evening.

(This article is reproduced from GT Radar with permission)

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This article: The U.S. manufacturing PMI unexpectedly expanded, and the probability of an interest rate cut in June was once less than 50%. Risk assets such as Bitcoin fell in response. First appeared on Zombit.