Markets
US PCE Inflation Hits 2.5%, What’s Next for the Crypto Market?
The global financial sector, not to mention the cryptocurrency market, was eagerly awaiting PCE inflation data today. According to the latest data, inflation fell to 2.5% in June, from 2.6% the previous month. It is worth noting that this is also in line with market expectations, but core inflation remained unchanged in June.
PCE inflation stands at 2.5%
The Commerce Department recently released U.S. PCE inflation data, which showed that inflation slowed to 2.5% in June from 2.6% the previous month. It is worth noting that the market was expecting a similar increase. inflation reading for June.
However, on a MoM basis, the Personal consumption expenditure Core PCE data came in at 0.1%, after remaining unchanged in May. The core PCE index showed that inflation was unchanged at 2.6% from May, up from market estimates of 2.5%. On a month-on-month (MoM) basis, the core PCE index came in at 0.2%, up from the 0.1% change seen in the previous month.
The cryptocurrency market seems to have reacted positively to the declining inflation figures, as evidenced by the current market performance. However, the mixed data seems to have fueled discussions about the Fed’s anticipated decision to continue with its policy rate plans.
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Will the cryptocurrency market continue to recover?
THE Cryptocurrency Market Bitcoin is up nearly 4% today, after a week of volatile trading. It seems that the latest mixed inflation data has further boosted market sentiment, which was already elevated today, amid buzz around the Bitcoin 2024 conference.
However, the core PCE numbers and the month-over-month change have fueled discussions about the Fed’s stance on its rate cut plans. The market now expects the central bank to keep the interest rate unchanged at its July policy meeting, with a roughly 88% chance of a rate cut in September, according to the CME FedWatch tool.
Following the release of the US PCE inflation figures, the US 10-year bond yield fell 0.71% to $4.229. In contrast, the US dollar index fell 0.02% to $104.105 at the time of writing.
Meanwhile, despite the mixed sentiment, the cryptocurrency market rose more than 4% to $2.39 trillion today, indicating strong market confidence. Bitcoin Price rose more than 5% to $67,300 today, while Ethereum Price climbed more than 3% to $3,238.
In particular, the recent US GDP The data, which beat market expectations, weighed on investor sentiment. The economy’s resilience in the face of rising interest rates has raised concerns that the Fed will stick to its policy rate plans.
However, several market analysts are positive about the latest data on PCE inflation in the United States. They continue to bet on a rate cut in September, even if they remain above the Fed’s 2% target range.
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