Bitcoin led a significant surge in the cryptocurrency markets on Friday, rising over 5% in the past 24 hours and surpassing $84,800. Other digital currencies such as Ethereum and Dogecoin mirrored the uptrend, increasing by 4.6% and 5.3%, respectively. This crypto momentum was part of a broader rally in risk assets.
Interestingly, this upward shift occurred despite negative news from the U.S. economy. The University of Michigan’s consumer sentiment index dropped sharply—from 57.0 to 50.8—signaling reduced confidence among American consumers. At the same time, consumer inflation expectations jumped to 6.7%, the highest in more than 40 years.
Typically, such figures would influence investors to seek safer assets. However, the market instead embraced a “risk-on” approach. Analysts cite renewed hopes that the Trump administration might ease trade tensions as one of the driving factors. This optimism appears to have spilled into the cryptocurrency sector, which often moves in tandem with speculative trends.
Still, market experts advise caution. Despite the recent rebound, several economic indicators point toward potential trouble ahead:
- Rising interest rates
- Weakening consumer confidence
- Uncertainty in the upcoming earnings season
These factors have led many economists to predict a possible U.S. recession by 2025, which could heavily impact cryptocurrencies and other high-risk investments.
Given the nature of crypto markets—operating 24/7—traders are bracing for potential volatility over the weekend. Any developments in geopolitics or macroeconomics could sharply influence trading behavior. Whether this is the beginning of a long-term bull trend or merely another temporary bounce remains to be seen.
Read the full article on The Motley Fool.
