Stagflation Fears Trap Bitcoin Below $65K
The Bitcoin price has been stuck in a holding pattern below $65K as stagflation fears rise. The culprit behind this stagnation is not a crypto-specific issue, but rather the macroeconomic phenomenon of stagflation.
The latest S&P Global US Manufacturing PMI for July 2026 came in at 53.9, marking 12 consecutive months of expansion in factory activity. However, new orders and output growth both hit four-month lows, while input costs remained elevated due to tariffs and energy prices.
This pattern of slowing growth and stubborn inflation is characteristic of stagflation, a scenario where economic growth slows down while inflation persists. The Bitcoin price has been affected by this narrative, with ETF outflows reaching hundreds of millions in early August 2026. This marks the second time this year that PMI data has spooked ETF holders.
The structural case for Bitcoin remains unchanged, with ongoing effects from the 2024 halving continuing to constrain new issuance. However, adoption trends are expected to reassert themselves as broader market forces dictate. Traders watching the $63,000 to $65,000 range should pay close attention to upcoming inflation data and Fed commentary on the growth-inflation tradeoff.