# China Rate Cuts

*Bitcoin and Stocks Drop as China Rate Cuts Stir Panic and U.S. Yield Curve Steepens*

By [aundingoya.eth](https://paragraph.com/@aundingoya.eth) · 2024-07-26

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China’s surprise rate cuts are rattling global markets, adding to concerns of economic instability. The People’s Bank of China cut its one-year rate to 2.3%, its biggest reduction since 2020, as it struggles to boost a weakening economy.

This move has intensified market anxiety, with Bitcoin falling nearly 2% to around $64,000 and Ethereum dropping over 5%, pulling down the broader crypto market. Equities are also affected, with major European indexes and Nasdaq futures slipping after a rough previous session.

The U.S. Treasury yield curve is steepening, which typically signals risk aversion. The widening gap between short- and long-term yields reflects growing fears of persistent inflation and uncertainty around future Fed rate cuts.

"Markets are jittery after China’s unexpected rate cut and the changing U.S. yield curve," says Ilan Solot, senior global strategist at Marex Solutions.

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*Originally published on [aundingoya.eth](https://paragraph.com/@aundingoya.eth/china-rate-cuts)*