"Earlier today, as bitcoin recovered from a rocky weekend, the U.S. manufacturing sector delivered a starkly bullish surprise to markets, with the Institute for Supply Management (ISM) Manufacturing Purchasing Managers' Index (PMI) jumping to 52.6 in January, nearly 4 points above the 48.5 consensus estimate and marking its return to expansion territory for the first time in over a year."
"When manufacturing activity expands, it indicates improving corporate earnings prospects, stronger demand, and - critically - greater investor confidence in risk assets. PMI data often leads corporate earnings and asset performance, and risk assets like Bitcoin have historically trended upward in sustained expansion environments. Crypto communities typically jump on the PMI print as a sign the economy may be shifting from cautious to opportunistic."
"The breadth of the rebound was notable: new orders surged to 57.1, production climbed, and backlog orders flipped positive. That's the kind of internals economists watch for signs that companies are ordering inputs and boosting output. While employment remains below 50, suggesting hiring hasn't fully caught up, the overall shift from contraction to expansion is the story. What does this mean for bitcoin? For Bitcoin markets, the implications go beyond a single data point."
U.S. manufacturing returned to expansion in January as the ISM Manufacturing PMI rose to 52.6, about 4 points above expectations and the highest reading since mid-2022. A PMI above 50 signals net expansion in factory activity and indicates some post-holiday demand. New orders jumped to 57.1, production increased, and backlog orders turned positive, showing companies are ordering inputs and lifting output. Employment remains below 50, so hiring has not fully recovered. Expanding manufacturing often precedes stronger corporate earnings and greater investor risk appetite. That improved macro momentum can encourage investors to ease hedges and increase allocations to risk assets such as Bitcoin, though a single print does not guarantee a sustained turnaround.
Read at Bitcoin Magazine
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