All eyes are on Wednesday, June 12th, as the U.S. central bank makes its policy decision on interest rates. Despite strong jobs data in May, the Federal Reserve is expected to keep interest rates unchanged for a seventh consecutive meeting, maintaining the 5.25% to 5.5% range. There is speculation that the number of cuts slated for this year may be reduced as policymakers analyze a variety of economic data.
The economic calendar for June 10-14 is highlighted by the core CPI (consumer price index) reports releasing on June 12th. This data serves as a crucial measure of inflation and has significant implications on the Fed’s monetary policy decisions, including interest rate adjustments. A higher CPI reading signifies rising inflation, putting pressure on the Fed to either raise or maintain interest rates. The year-on-year CPI figure is expected to stay at 3.4%, indicating that there may not be a change in rates this week.
The correlation between Bitcoin price and CPI data has been strong this year, with higher-than-expected CPI results having a bearish effect on the digital asset, and lower-than-expected CPI results being bullish. This demonstrates the impact of economic indicators on the cryptocurrency market. The upcoming key events for the week include the OPEC Monthly Report on Tuesday, May CPI Inflation data and Fed Interest Rate Decision on Wednesday, and May PPI Inflation data and MI Consumer Sentiment data on Thursday and Friday respectively.
On June 13th, core PPI (producer price index) reports will be released, providing insight into the average change over time in selling prices received by domestic producers of goods and services. Analysts believe that the Fed may wait for a series of data confirming sustained inflation before implementing any rate cuts. The first rate cut is expected to occur in September, with projections of two rate cuts for the year and the beginning of a cutting cycle in September.
In terms of the crypto market impact, the Fed rate decision is anticipated to already be factored into crypto markets, with rates likely to remain unchanged. While there may be some volatility mid-week, the sideways momentum is expected to persist. Altcoins may experience some setbacks as Bitcoin dominance remains high, delaying the anticipated altseason. Crypto trader ‘Emperor’ shared his market insights with his followers on X, highlighting the uncertain position of the market amid expectations of a Fed rate cut and celebrity scams causing confusion in the market. Overall, the market sentiment remains uncertain with potential fluctuations in the coming days.
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