US CPI Expected At 3.1%; Will Fed Start Lowering Interest Rates Soon?

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As a researcher with extensive experience in financial markets and cryptocurrencies, I believe that the upcoming U.S. Consumer Price Index (CPI) data release on July 11 is of significant importance to both traditional financial markets and the crypto market. The inflation data will be closely monitored by investors as it may influence the Federal Reserve’s future policy rate decisions.

Anticipation runs high among crypto market players as they closely monitor the upcoming U.S. Consumer Price Index (CPI) data release on Thursday, July 11. This significant inflation indicator will be closely watched not just by the crypto community but also the broader financial market. The outcome of this crucial data could influence the Federal Reserve’s future policy rate decisions.

In this analysis, we delve into the implications of Wall Street’s projections and the latest U.S. Consumer Price Index (CPI) figures for the Federal Reserve’s rate-setting deliberations.

Wall Street Bets On Cooling US CPI Data

Based on industry predictions, this week’s inflation data may bring comfort to financial market investors, not just those in the crypto sector. It is anticipated that the U.S. Consumer Price Index (CPI) will reveal a decrease in inflation to 3.1% in June, after a rise of 3.3% in May.

Month over month, the Consumer Price Index (CPI) inflation is predicted to rise slightly by 0.1%, following no change in May. In contrast, the Core CPI inflation, as perceived by Wall Street, is forecasted to remain stationary at a 2.2% increase. Additionally, the year over year growth rate of the U.S. Core CPI is projected to stay constant at 3.4% in June.

Based on projected decreases in inflation, investors anticipate a lenient monetary policy from the Federal Reserve. Furthermore, the latest employment figures in the United States have strengthened market belief in the possibility of a rate reduction by the Federal Reserve during their September meeting.

As an analyst, I’m observing that the markets are currently expecting a 0.25 percentage point reduction in interest rates by the Federal Reserve during their September meeting, according to CME’s FedWatchTool. Furthermore, this week brings another important inflation report, specifically the U.S. Producer Price Index (PPI) data from the Labor Department. Investors will be closely monitoring both the PPI and Consumer Price Index (CPI) figures for any potential signals regarding future market trends.

How The Crypto Market Is Likely To Perform?

The Federal Reserve views the Consumer Price Index (CPI) inflation figures of the United States as a significant indicator to assess the level of inflationary pressure within the country. Consequently, investors will closely monitor this data for any indications that may influence the Fed’s decisions regarding their future policy rate adjustments.

As a researcher, I’ve noticed that many market analysts are predicting a rate cut by the Federal Reserve in September. However, if the U.S. Consumer Price Index (CPI) comes in hotter than expected, it could dampen overall market sentiment and make some investors reconsider their positions. Therefore, it’s crucial for investors to carefully assess the situation before making any investment decisions.

Recently, the cryptocurrency market has experienced increased volatility, as indicated by the price fluctuations of Bitcoin and other altcoins. The German government’s sale of Bitcoin and the ongoing issues with Mt. Gox’s repayments have negatively impacted investor confidence in the market.

Lately, the market mood seems to be improving, as evidenced by the strong inflows into the U.S. Spot Bitcoin ETF. Furthermore, optimism is growing regarding the potential approval of a Spot Ethereum ETF in the near future. Additionally, filings for a Solana ETF have surfaced in the United States, suggesting that a Bitcoin and altcoin price surge may be on the horizon.

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2024-07-10 12:40