ratecutexpectations

Right now, there is a massive gap between what the Fed says and what is actually happening. While some question President Trump’s style, his demand to lower interest rates is backed by cold, hard facts. The Federal Reserve is ignoring "hidden" signals that show the economy is ready to soar.
Let’s Dissect the Facts:
1. GDP Growth:
The economy is a rocket. The Bureau of Economic Analysis (BEA) just confirmed on January 22 that Q3 2025 growth was 4.4%. & The Atlanta Fed’s GDPNow model updated its forecast on January 21, 2026. It is now tracking above 5.4% for Q1 2026. .
2. The Inflation Lie: Official vs. Real-Time
The biggest disagreement is about the cost of living.
​The Official Number: The government says inflation is 2.7%. But they use old data that is often weeks or months out of date.​The Real-Time Number: Independent trackers like Truflation (which uses live data from Amazon, Walmart, and Zillow) show inflation is actually around 1.7%—well below the Fed's target.
3. Labor Market:
The job market is stable, not "overheated." Jobless claims are at a steady 200K, meaning people are working and the economy is healthy.
"Traditional economists say you don't cut rates when jobs are strong/steady. But they are wrong. If inflation is dead, keeping rates high is just a tax on growth."
4. No More Excuses for the Fed
Fed Chair Jerome Powell says he wants to stay "independent" from politics. That sounds good, but independence should not be an excuse for being slow or wrong. With a steady job market and high growth, this is the "Golden Moment." The Fed can cut rates now to boost the economy without any fear.
5. Protecting the Market
If rates don't drop soon, the stock market will stay stuck in a "sideways chop" (going up and down with no progress). This makes investors lose hope. Also, cutting rates will slightly lower the value of the Dollar, which actually helps American businesses sell more products to other countries.
The Verdict:
If the Fed Powell continues to wait, they risk a "Deflation Spiral" where the economy slows down so much that it sucks up all the potential growth or worse it crashes. If we want to hit 6% growth by the end of 2026, we need lower rates immediately.This isn't just what Trump wants; it’s what the data demands.
#USIranMarketImpact #RateCutExpectations #GrayscaleBNBETFFiling #Powell

Today we'll cover:
Still No Demand Regime Change for BitcoinGold ETF Flows Are Catching Up to BitcoinInflation Data Is Not Conducive to Rate Cuts
Taken together, these three charts point to the same conclusion from different angles.
Bitcoin’s price action isn’t being held back by a single shock or headline risk. It’s being constrained by a broader setup where fresh demand remains fragile, capital continues to favour defensive assets during uncertainty, and monetary policy lacks the room to turn meaningfully supportive.
That combination doesn’t rule out recovery. But it does mean that upside remains conditional, easily interrupted, and highly sensitive to confirmation rather than narrative. In this environment, what matters most is not isolated signals, but whether they can reinforce each other over time.
Still No Demand Regime Change for Bitcoin
Last week, Bitcoin briefly crossed an important threshold: rolling 30-day ETF flows turned positive.
That matters because sustained ETF inflows are a precondition for any durable price recovery. Without new capital consistently entering through ETFs, upside moves tend to stall rather than compound.
We also flagged at the time that this was only an early signal, not confirmation.
This week made that distinction clear. Renewed geopolitical tensions spilled into broader markets, triggering another bout of risk-off behavior… again. Since the start of the Trump administration last year, this pattern has repeated itself again and again: periods of calm interrupted by tariff threats, policy headlines, and sudden volatility.
Most risk assets managed to recover from the latest shock. Bitcoin didn’t.
The reason is simple. Bitcoin isn’t just dealing with macro uncertainty, it’s also coming off a deep and prolonged drawdown in capital flows.
As the chart shows, cumulative Bitcoin ETF flows have now been in drawdown for more than 100 consecutive days. That’s an unusually long stretch of sustained net demand weakness. When demand is this fragile, even modest spikes in volatility are enough to interrupt recovery attempts, which is exactly what happened this week, as the nascent inflow streak broke once again and rolling flows are negative once more.
The result is a market that remains unresolved. A recovery is still possible, but it is not yet self-reinforcing.
Until ETF inflows can persist through periods of broader market stress, Bitcoin remains in an undecided demand regime rather than a confirmed recovery phase.

Cumulative Bitcoin ETF flows have now been in drawdown for over 100 days, a sign that recent price stability has lacked durable demand support. Short-lived inflow streaks have repeatedly failed under market stress, highlighting why confirmation, not optimism, remains the key missing ingredient.
Gold ETF Flows Are Catching Up to Bitcoin
Earlier this week, we looked at how correlation dynamics across macro assets influence Bitcoin’s behavior. One of the key conclusions was that, in the current environment, gold has been quietly benefiting at Bitcoin’s expense.
When you zoom out, that shift becomes very clear.
The chart below compares cumulative net flows into Bitcoin ETFs and gold ETFs since the launch of spot Bitcoin ETFs in early 2024. Bitcoin initially dominated, attracting significantly more capital than gold. But that gap has narrowed sharply over the past few months.
Since November, Bitcoin ETF flows have stalled. Gold ETF flows haven’t. As a result, gold is now only about $6 billion behind Bitcoin’s roughly $58 billion in cumulative net inflows over the same period. And the gap continues to close.
This isn’t happening because gold and Bitcoin are telling different long-term stories. In fact, they share many of the same structural narratives around hard assets and protection against monetary debasement.
The difference shows up in the short term.
Repeated risk-off episodes (many tied to U.S. tariff threats and policy uncertainty since 2025) have consistently favored gold. During those moments, gold tends to attract fresh inflows, while Bitcoin behaves more like a risk asset and struggles to retain momentum.
In other words, even when both assets rise over long horizons, their demand dynamics diverge when uncertainty spikes. And over the past year, those spikes have been frequent enough to steadily tilt relative flows toward gold.
Since Bitcoin ETF flows stalled in late 2025, gold ETFs have continued to accumulate capital, steadily closing the gap. Repeated risk-off episodes have favored gold’s defensive profile, highlighting how short-term demand dynamics (not long-term narratives) are driving relative flows.
Inflation Data Is Not Conducive to Rate Cuts
Markets broadly expect the upcoming FOMC meeting to result in no change to the policy rate.
Part of that expectation is political. Fed Chair Jerome Powell has been explicit that monetary policy will remain data-driven, and cutting rates while facing overt political pressure would require a clear justification in the numbers.
That justification isn’t there.
The labor market hasn’t broken, despite repeated fears over the second half of 2025. And inflation continues to pose essentially the same challenge it did two years ago.
The chart below shows year-on-year PCE inflation, which I remind you is the Fed’s preferred gauge of inflation. Even smoothing out short-term noise and data delays related to the government shutdown, the message is straightforward: inflation has been stuck at elevated levels for roughly two years.
More importantly, it remains well above its pre-COVID range.
That matters because the COVID shock is no longer recent history. We are now nearly six years removed from the 2020 crisis. Year after year of inflation running above target compounds, both economically and politically, and it limits how much flexibility the Federal Reserve has.
Absent a clear downside surprise in inflation or a sudden deterioration in growth, this makes a fast or aggressive rate-cutting cycle unlikely. Cuts may still come eventually, but they are likely to be cautious and conditional rather than front-loaded.
This isn’t a new message from the Fed, and it probably won’t rattle markets on its own. But it does act as a brake on how quickly risk-on assets can expand, even if it lacks the shock value of tariff headlines or geopolitical flare-ups.
PCE inflation has made little net progress for nearly two years and remains well above its pre-COVID range. This persistent plateau limits the Fed’s ability to justify rapid rate cuts absent a clear deterioration in growth or labor conditions.
Tactical Takeaway
The current setup argues for restraint rather than anticipation.
Bitcoin is not facing an outright hostile environment, but it is still operating without durable demand confirmation and without meaningful macro tailwinds. In this kind of market, early signals tend to appear and disappear, and short-lived recoveries are easily interrupted by volatility or shifts in risk appetite.
For investors, the key mistake to avoid is treating stabilization as validation. Until ETF inflows persist through market stress increasing exposure aggressively risks chasing moves that lack reinforcement.
The discipline here is simple: let confirmation set the pace, not conviction. Incremental positioning can make sense, but only if demand and macro signals begin to align rather than diverge.
(Market commentary, not financial advice.)
#BTC #BTCVSGOLD #RateCutExpectations