The U.S. Bureau of Economic Analysis reported that third-quarter growth outperformed the 3.2% forecast, bolstered by robust consumer spending and significant business investment in artificial intelligence infrastructure. However, this economic acceleration coincides with persistent price pressures. The Personal Consumption Expenditures (PCE) price index rose 0.5% in September, pushing annual core inflation to 3.1%. These figures remain stubbornly above the Federal Reserve’s 2% target, complicating the outlook for monetary policy.
Following the Fed's decision to hold interest rates at 3.75% to 4.00%—a move supported by a 10-2 vote—market participants are weighing the possibility of a year-end rate hike. Chair Kevin Warsh noted the strength of current economic activity even as he acknowledged the inflationary environment. For Bitcoin, the prospect of elevated interest rates creates a challenging landscape, as higher yields on government bonds typically diminish the appeal of non-yielding assets. Despite this macro pressure, on-chain data offers a counter-narrative; Santiment reported a net withdrawal of 14,942 BTC from centralized exchanges, the largest daily outflow in five weeks, suggesting long-term holders are moving assets into cold storage even amid price volatility.

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