US inflation and employment data mainly affect the Cryptocurrency market, especially the price of Bitcoin. It has been reported that due to the continued tension in the US labor market, the Federal Reserve is expected to raise interest rates in July after maintaining interest rates unchanged last month
US inflation and employment data mainly affect the Cryptocurrency market, especially the price of Bitcoin. It has been reported that due to the continued tension in the US labor market, the Federal Reserve is expected to raise interest rates in July after maintaining interest rates unchanged last month. However, the Consumer price index and core personal consumption expenditure inflation, the Fed's preferred indicator to measure inflation continued to decline.
The annual inflation rate of CPI in June dropped to 3%, marking the 12th consecutive month of decline. This is the lowest value since March 2021. In addition, the core Consumer price index inflation rate fell to 4.8% from 5.3% last year. However, the CPI rose by 0.2% in June, compared to 0.1% last month.
Wall Street analysts also expect the Consumer price index (CPI) to decline significantly. Bloomberg, Citigroup, HSBC, United Commercial Bank of Switzerland and Nomura Securities Securities expect CPI to be 3%, while Goldman Sachs, Bank of Montreal, Barclays Bank, Morgan Stanley, TD Securities and Canadian Imperial Bank of Commerce expect inflation to fall to 3.1%. At the same time, JPMorgan Chase, Royal Bank of Canada and Visa forecast annual CPI of 3.2%.
Experts said that a decline in the overall inflation rate to 3-3.2% would lead to further upward movements in the stock market and the Cryptocurrency market. Analysts at JPMorgan Chase suggest that the inflation rate may be lower than market consensus expectations and force the Federal Reserve to turn the outlook towards moderation.
The CMEFedWatch tool shows that the probability of the Federal Reserve announcing a 25 basis point interest rate hike at the FOMC meeting on July 26th is 90%. However, the U.S. Dollar Index (DXY) fell to a two month low of 102 and is expected to continue to fall below 101. This will support a further increase in Bitcoin prices to over $31000.
Bitcoin (BTC) and Ethereum (ETH) are set as Rallying
As CPI inflation and the US dollar fall, the prices of Bitcoin and Ethereum will further rise. The market sentiment of BTC hitting $100000 has triggered Standard Chartered Bank to revise its Bitcoin forecast higher. Cryptographic analysts pointed out that the price of Bitcoin reached $35000 and Ethereum exceeded $2000.
Popular analyst Michael van de Poppe predicts that Bitcoin will eventually surpass $31500. However, he suggests acting cautiously on CPI day. The BTC price is currently $30800, a 1% increase from the 24-hour low of $30358.
Meanwhile, analyst Ali Martinez pointed out that ETH prices are stable support between $1800 and $1870, with 3.4 million addresses purchasing 11.2 million ETHs. However, the resistance range of $2040 and $2100 is more significant with the purchase of 27 million ETH from 1 million addresses. The ETH price is currently 1888, which has increased by nearly 0.5% in the past 24 hours.
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