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Red tape and sticky inflation challenge rate cuts, shifting miner focus
Headline PCE for July came in at 3.7% year on year, a tenth above expectations, while consumer confidence fell to 89.4 in August.
US inflation data left the Federal Reserve with limited room to cut rates, raising pressure on how quickly policymakers can pivot, according to ETF Trends. Core PCE for July rose 0.2% month on month and 3.3% year on year, both in line with consensus, but headline PCE firmed to 3.7% year on year, about a tenth above expectations.
The rest of the month’s economic indicators pointed the other way. Consumer confidence fell to 89.4 in August, its weakest reading in seven months, and expectations dropped by 5.8 points to 68.2, while new home sales fell 10.5% in July to 607,000.
Despite the mixed macro picture, fund and crypto flows moved. Bitcoin closed Aug. 26, 2026 near $78,500 and reclaimed its 200-day moving average for the first time in 270 sessions, and digital asset investment products drew $1.65B in inflows over the first three trading days of the week to Aug. 27.
ETF Trends also argued that constraints outside capital are increasingly shaping portfolio demand, pointing to tighter data center availability and long grid connection timelines. Data center vacancy has dropped from 10% in 2019 to around 1% and has held for a third consecutive year, while the average time to connect a new facility is now about five years, a setup the outlet links to potential benefits for Bitcoin miners as AI loads grow.
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