Crypto Market Prepares For A Volatile Week
The upcoming week is anticipated to be quite volatile for crypto investors, who are preparing for two major economic events.
Bitcoin’s recent surge from $27,000 to over $43,000 seems also influenced by falling interest rates in major bond markets, hinting at a potential shift in central banks’ policies towards easing monetary measures.
US CPI Report: 12 December
Next week’s U.S. CPI inflation data is gaining importance, especially since investors are increasingly anticipating a rate cut from the Fed in March.
The consumer price index is expected to show a slight increase of 0.1% for the month, following a stagnant figure in October.
FOMC Meeting: 13 December
The FOMC is likely to keep rates unchanged at 5.25-5.50% in its December meeting, despite previous indications of possible further tightening. The focus is on any hints of future rate cuts, as inflation is still expected to remain above the 2% target until at least 2025.
Hot Take
If the CPI data shows inflation at 3% or lower, signaling that inflation is slowing more than anticipated, it could boost expectations for a rate cut. This scenario may lead to a rise in the crypto market, as investors might pursue higher returns in riskier assets like cryptocurrencies.
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