The macroeconomy had a difficult year in 2022, but it has begun to slowly improve this year. Inflation has started to decline in major economies as a result of the majority of governments reaffirming their hawkish positions. In reality, growth indicators have already begun to blaze.
Take China itself as an example. The National Bureau of Statistics published data on industry activity on Tuesday. In February, the official manufacturing PMI increased to 52.6. According to the graph below, the reading is the highest in over 11 years. The reading for this index was 53.5 in April 2012.
The 50-point threshold serves as a distinction between expansion and contraction for purposes of context. According to convention, expansion is indicated by a PMI reading above 50. Figures under 50 signify contracting growth. Just a value of 50.5 was anticipated by economists, but the most recent figure managed to surprise everyone.
The key finding was able to have a beneficial impact on Chinese stocks. The SSE increased by 1% while the CSI 300 index increased by 1.4% for the day. On the other side, on Mar. 1, the Hang Seng Index in Hong Kong increased by more than 4%.
Many in the industry anticipate Bitcoin to “follow” the market breakthrough. John Squire, a well-known business analyst, confidentially revealed to Watcher Guru that BTC was no longer concerned about the S&P 500. Instead, he claimed, it gives the Chinese market greater consideration. In fact, numerous well-known analysts in the field predict a similar outcome.
Is Bitcoin Truly Uncorrelated With Chinese Equities?
Yet, the correlation statistics tell a different tale. It’s important to note that Bitcoin and Chinese equities continue to be “uncorrelated,” according to a recent Kaiko report. The CSI-Bitcoin correlation is somewhat above zero, as shown below. While there has been a little improvement, the correlation between the HSI and Bitcoin is still negative.
On the other hand, the relationship between Bitcoin and American stocks has recently somewhat improved. The correlation curves for the Nasdaq and S&P 500 [black, grey] are both pointing upward towards their levels from December 2022, confirming the same as illustrated below.
Even the second-biggest economy currently lacks the ability to alter the direction that the world’s largest economy is taking Bitcoin in. So, a boost from U.S. equities is probably necessary for Bitcoin to keep climbing. At the time of writing, BTC was trading at $23,744.22 with a hike of 1.42% over the last 24 hours.