The American CPI this Thursday Could Change the Game for Cryptos!

This Thursday, attention will be focused on the United States with the anticipated release of the Consumer Price Index (CPI). This economic indicator could trigger significant movements in the markets, particularly for the US dollar and cryptocurrencies. As investors remain vigilant, speculation is rife about the potential impact of these key figures.

The Consumer Price Index: Cornerstone of the American Economy

The Consumer Price Index (CPI) is an essential measure of inflation that reflects the price changes of goods and services purchased by American households. This index is calculated monthly by the Bureau of Labor Statistics (BLS) and serves as a barometer for evaluating the cost of living. The CPI encompasses a wide range of products, including food, clothing, housing, healthcare, and entertainment. Economists and policymakers closely monitor this data to anticipate economic trends and adjust monetary policies accordingly.

The publication of the CPI data for June is scheduled for this Thursday at 2:30 PM, and it is particularly anticipated by investors. The current consensus expects a decrease in overall annual inflation to 3.1%, compared to 3.3% the previous month, while core inflation is expected to remain steady at 3.4%.

BIGGEST EVENT FOR THIS WEEK 🚨 
 
THE US CPI IS EXPECTED TO
RELEASE TODAY AT 8:30 AM ET.
 
EXPECTATIONS ARE OF 3.1% WHILE
THE LAST MONTH CPI WAS 3.3%
 
HERE ARE THE FEW SCENARIOS 👇
 
1) CPI higher than 3.1%
 
THIS WILL BE BAD FOR THE MARKET
GIVEN THAT THE LAST TIME CPI DATA… pic.twitter.com/yudjPLPl8g

— Ash Crypto (@Ashcryptoreal) July 11, 2024

Publication of the CPI: What Consequences for the Dollar and Bitcoin?

Inflation measured by the CPI is a determining factor for the value of the US dollar. If the CPI shows a larger-than-expected decrease, it could strengthen expectations of an interest rate cut by the Federal Reserve in September, thereby weakening the dollar. A weaker dollar could benefit GBP/USD, which recently surpassed a major resistance level, and Bitcoin, which could see its price increase due to increased demand from institutional investors.

Current forecasts suggest a decrease in overall inflation to 3.1%, with core inflation remaining stable at 3.4%. However, a surprise increase in the CPI could upset these expectations. Fed Governor Lisa Cook mentioned the possibility of a soft landing for the economy, with declining inflation without a significant rise in unemployment, which could lead the Fed to consider rate cuts. This prospect is particularly favorable for stock markets and cryptocurrencies, including Bitcoin, which could benefit from a more accommodative monetary policy.

According to experts from 10x Research, notably their CEO Markus Thielen, Bitcoin could see a significant increase if the CPI data confirms a decline in inflation. Thielen indicated that Bitcoin could reach nearly $60,000, a forecast that has already been reflected with a rise to $59,350 before the data release.

Therefore, this Thursday’s CPI figures could determine the future direction of financial and crypto markets. High inflation could strengthen the US dollar, while a decline in inflation could pave the way for Fed rate cuts, thus boosting Bitcoin and other digital assets.