Markets
Cryptocurrency Market Falls Ahead of US CPI Data
The cryptocurrency market faced a correction as major assets declined ahead of the release of US inflation data.
The U.S. Consumer Price Index (CPI) for June is scheduled to be released today at 8:30 a.m. ET (12:30 UTC). According to Investing.com analyst Jesse Cohen, most U.S. banks and investment firms expect the country’s inflation rate to decline slightly, to between 3% and 3.2%.
🇫🇷🇺🇸 ESTIMATES OF US CPI INFLATION IN JUNE
• TD BANK: 3.0%
•SCOTIA BANK: 3.0%•JP MORGAN: 3.1%
•WELLS FARGO: 3.1%
•CITI: 3.1%
•BARCLAYS: 3.1%
•BNP PARIBAS: 3.1%
•NOMURA: 3.1%
•https://t.co/LOppBTC8mR: 3.1%•BANK OF AMERICA: 3.2%
•GOLDMAN SACHS: 3.2%•MORGAN STANLEY: 3.5%… pic.twitter.com/CY7EoNwXaz
— Jesse Cohen (@JesseCohenInv) July 10, 2024
On the other hand, investment bank Morgan Stanley estimates that June CPI will reach 3.5% year-on-year, according to Cohen’s X post.
If the June inflation rate falls to around 3.1%, the analyst says that will increase the chances of a Fed rate cut in September. Cohen added in the X thread:
“Beyond 3.5%, we can forget about rate cuts in 2024.”
The inflation rate abandoned from 3.4% in April to 3.3% in May, crypto.news reported. This is notably the lowest level seen since April 2021. Consequently, the cryptocurrency market has seen a market-wide rebound with Bitcoin (Bitcoin) exceeding the $69,000 mark on June 12, the day the inflation report was released.
Historically, the cryptocurrency industry has typically faced bearish corrections before the CPI report was released. However, it happened again.
The global cryptocurrency market cap has fallen 1% in the past 24 hours and stands at $2.24 trillion at the time of reporting. Bitcoin has slipped 2% and is hovering around $57,900.
A decline in the US inflation report can potentially hint at market-wide bullish momentum for the cryptocurrency sector and vice versa.