The cryptocurrency market has been following a turbulent course for decades. In particular, macroeconomic concerns have put pressure on investor sentiment. It will be announced next week in the USA Consumer Price Index (CPI) and Producer Price Index (PPI) data became the focus of investors this week. Markets to be announced inflation Bitcoin in the cryptocurrency market of data $93,857.8 and eagerly awaits how it will shape altcoin performances.
What are the Expectations for CPI Data?
cryptocurrency marketis closely following the CPI data to be announced on Wednesday, January 15. CPIwill provide important clues about the overall health of the US economy. Recently announced strong employment data and statements by central bank officials have increased investors’ concerns.
According to US Department of Labor data, 256 thousand new jobs were added in December. This figure was well above the market expectation of 160 thousand. Additionally, the unemployment rate decreased to 4.1 percent from 4.2 percent in the previous month. Strong labor market data US Federal ReserveIt reinforced expectations that the Fed could maintain its tight stance in monetary policy. Markets do not expect a rate cut until June this year.
According to market forecasts, CPI is expected to remain stable at 0.3 percent on a monthly basis. On an annual basis, CPI is expected to increase from 2.7 percent to 2.9 percent. Core CPI, which excludes food and energy prices, is expected to decrease from 0.3 percent to 0.2 percent on a monthly basis. On an annual basis, core CPI is estimated to remain constant at 3.3 percent. Higher-than-expected future data may adversely affect investor sentiment and lead to a decline in the cryptocurrency market.
How Can PPI Data Affect the Market?
In addition to the CPI, it will be announced on Tuesday, January 14 PPI data is also closely monitored. As it is known, PPI plays an important role in understanding inflationary pressures by measuring the change in production costs. PPI data coming above expectations may support the Fed’s plan to keep interest rates constant and not reduce them for a long time.
Fed Chairman Jerome PowellIn their statement last month, they stated that they foresee only two interest rate cuts until 2026. This went against the market’s expectations of four interest rate cuts. Fed officials state that economic data will be closely monitored and interest rate decisions will be shaped accordingly. This has increased uncertainty among investors and led to volatility.
If the Fed’s tight monetary policy continues, short-term fluctuations in Bitcoin and altcoins will be inevitable. However, many market experts remain confident in the growth potential of cryptocurrencies in the long term. Investors will carefully monitor the CPI and PPI data to be announced next week and take positions accordingly.
Disclaimer: The information contained in this article does not constitute investment advice. Investors should be aware that crypto currencies carry high volatility and therefore risk, and should carry out their transactions in line with their own research.
