Bitcoin's Ascent Halted as Economic Indicators Signal Caution

After reaching above $79,000, Bitcoin has retreated to $76,500, pausing its rally from the late-March lows below $65,000. However, recent economic data suggests that a rapid rebound may not be imminent. The University of Michigan's Survey of Consumers showed a decline in consumer sentiment to a record low of 49.8, mainly due to inflation concerns related to the Iran conflict. Furthermore, inflation expectations have risen, with the one-year gauge increasing to 4.8% and long-term expectations reaching 3.5%, the highest since October 2025. This surge in inflation expectations could limit the Federal Reserve's ability to cut interest rates or provide liquidity, potentially capping gains in BTC and other risk assets. Analysts warn that the long-term expectations move is particularly concerning for the Fed, as it may indicate that inflation psychology is becoming unanchored. The Fed is expected to maintain its benchmark interest rate, while traders anticipate a potential rate increase by the Bank of Japan in June. In the crypto market, sustained ETF inflows are crucial for supporting BTC prices, and coordinated efforts to address the KelpDAO exploit have helped DeFi tokens perform relatively well. The CoinDesk DeFi Select Index gained 0.5% over 24 hours, outperforming the broader market.