Bitcoin, Mantra, Notcoin prices rise as US CPI data point to a Fed cut

As a seasoned crypto investor with a few years of experience under my belt, I’ve learned that economic data releases can significantly impact the prices of Bitcoin and other cryptocurrencies. This week’s US inflation data was no exception.

As a researcher studying the cryptocurrency market, I’ve observed an intriguing trend: Bitcoin and various altcoins experienced a surge in value following the US Department of Labor’s release of favorable June inflation figures.

Bitcoin surged past the $59,000 mark on Thursday, representing a significant increase from its previous low of $53,700 in the previous week. Meanwhile, several alternative tokens such as Mantra (OM), Notcoin (NOT), AAVE (AAVE), and JasmyCoin (JASMY) experienced double-digit percentage gains.

US inflation data

As a data analyst, I’d rephrase it as: According to the Bureau of Labor Statistics (BLS), the consumer price index (CPI) that I closely monitor decreased from 0.0% to -0.1% in June. This figure was unexpectedly lower than the median forecast of 0.1%.

The Consumer Price Index’s headline figure decreased from 3.3% to 3.0%, falling below the anticipated median of 3.1%. Concurrently, the core CPI saw a decrease from 0.2% to 0.1%, while going from 3.4% to 3.3%. In simpler terms, the headline inflation rate dropped to 3.0% in contrast to the predicted median of 3.1%, and the core inflation rate experienced a decline, moving from 0.2% to 0.1% and from 3.4% to 3.3%.

As a crypto investor, I’ve noticed some encouraging signs regarding inflation trends. These figures suggest that inflation is on the mend and could potentially impact the Federal Reserve’s future decisions. In his latest statement, Jerome Powell hinted that the central bank might consider reducing interest rates if inflation kept decreasing further.

As a crypto investor, I’m closely monitoring the economic landscape, and based on current trends, I believe the Federal Reserve is likely to lower interest rates for the first time this year during their September meeting. Furthermore, recent high-frequency data reveals that both manufacturing and non-manufacturing sectors experienced declines, with their respective PMI indices dropping below the 50 mark in June – a clear indication of contracting economic activity.

As a researcher, I’ve analyzed the latest US Consumer Price Index (CPI) data, and I found that monthly headline inflation for June came up short of my expectations, recording a decrease of 0.1%, whereas the consensus forecast predicted an increase of 0.1%. This result brings the annual measure down to 3.0% from the previous 3.1%.

— Mohamed A. El-Erian (@elerianm) July 11, 2024

According to a recent report from the Bureau of Labor Statistics (BLS), the unemployment rate climbed up to 4.1%, yet the pace of wage growth appeared to decelerate.

Impact on Bitcoin, Mantra, and Notcoin

When the Federal Reserve adopts a more accommodative monetary policy, cryptocurrencies generally experience growth. For instance, Bitcoin reached an all-time high this year in response to the Fed’s indications of possible interest rate reductions.

As an analyst, I would interpret the interest rate cuts as making safer investments less attractive compared to riskier ones. Consequently, investors might consider shifting their funds from money market accounts towards assets such as Bitcoin, Mantra, and Notcoin, which carry a higher level of risk but potentially offer greater returns. Additionally, other altcoins like Ondo Finance, Near Protocol, and Pepe could potentially continue gaining traction due to their perceived growth potential.

Coins might experience a robust surge alongside other investments such as stocks, with the Nasdaq 100, S&P 500, and Dow Jones reaching new peak levels.

Despite the challenges and gains in the crypto market, it’s essential to acknowledge potential risks that could influence prices. For instance, the German government’s ongoing sale of its Bitcoin holdings increases the available supply, which could put downward pressure on prices. Additionally, miner capitulation persists, meaning some miners are giving up or selling their coins due to unprofitability, further impacting the market. Lastly, distributions from Mt.Gox continue, adding more coins to circulation and potentially affecting price stability.

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2024-07-11 16:36