As a seasoned crypto investor with a keen eye on market trends and a background in economics, I’ve seen firsthand how inflation data can impact the cryptocurrency markets. The latest Consumer Price Index (CPI) release from the US Bureau of Labor Statistics has once again proven this point.
This month, the United States Bureau of Labor Statistics (BLS) has released new data concerning the Consumer Price Index.
As is normally the case, this has caused some volatility within the cryptocurrency markets.
- In June, the CPI for all urban consumers fell 0.1%, seasonally adjusted
- This represents a change of 3% over the last 12 months, not seasonally adjusted.
- On the news, Bitcoin’s price shot up to almost $60K amid increased volatility. It has retraced to where it currently trades at around $59,200.
As the head of derivatives at Bitfinex, I, Jag Kooner, shared my insights with CryptoPotato regarding the significant role the Consumer Price Index (CPI) plays in shaping the behavior of the wider cryptocurrency market.
He noted that there was general agreement for the Consumer Price Index (CPI) to stay the same, but instead, it decreased by 0.1%. This finding, according to him, strengthens the argument that inflation is easing up.
A unexpectedly low Consumer Price Index (CPI) figure announced today might lead Bitcoin to follow other risk assets, as it reinforces the notion of decreasing inflation and a possible interest rate reduction. Investors will pay close attention to the Federal Reserve’s comments and market responses to this CPI release and upcoming Fed meetings to determine Bitcoin’s correlation with equities. Nevertheless, we think that just one inflation report would not eliminate the supply concerns for Bitcoin, which would take more time for the market to fully integrate.
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2024-07-11 15:40