WEB3
by BSCN
February 13, 2024
Factors contributing to the inflation decrease include a drop in gasoline prices, balancing out increases in food and shelter costs.
In a recent report by the Bureau of Labor Statistics, the Consumer Price Index revealed a 3.1% rise in the cost of living over the year as of January. While annual inflation exceeded forecasters' expectations of 2.9%, it represents a drop from December's 3.4%, the lowest since June.
Factors contributing to this trend include a dip in gasoline prices in January on a seasonally adjusted basis. This contributed to an overall reduction in the inflation rate, even as food and shelter costs experienced significant increases.
The data indicates a rocky path for inflation, with the Federal Reserve seeking clear signs of its decline before considering a cut in its benchmark interest rate. To combat inflation, the benchmark rate has been kept at a 22-year high.
Following the release of Consumer Price Index (CPI) numbers, market expectations regarding the Federal Reserve's interest rate cuts declined.
The CME Group's FedWatch tool indicated a drop from 57% to 38% in the probability of rate cuts at the May monetary policy meeting. This shift in expectations has potential implications for the crypto market. However, questions arise about recent inflation data’s potential impact on the crypto market.
Historically, Bitcoin has been regarded as a store of value and a hedge against inflation. Lower inflation may lead to increased demand for Bitcoin if it is interpreted as a sign of economic stability. Altcoins could also benefit from an improved market sentiment.
While lower inflation might be perceived positively, the crypto market is inherently volatile. Regulatory developments, macroeconomic events, and investor sentiment contribute to market fluctuations. Regardless of inflation trends, expect ongoing shifts in crypto prices.
In response to the news, Bitcoin experienced a drop from its 2-year high of $50,000 to around $48,931. Borrowing costs can rise as interest rates rise, which could cool economic activity and speculative investments, including cryptocurrency.
However, it is common for investors to switch from cryptocurrency to safer options like bonds or gold during periods of economic uncertainty or inflation concerns.
Disclaimer
Disclaimer: The views expressed in this article do not necessarily represent the views of BSCNews. The information provided in this article is for educational and informational purposes only and should not be construed as investment advice. BSCNews assumes no responsibility for any investment decisions made based on the information provided in this article
Latest News
0h : 51m ago
OKX Ventures, The Open Platform, and Folius Ventures Launch $10M Telegram Growth Hub
October 29, 2024
Is Bitcoin Set to Soar Even Higher?
October 29, 2024
DWF Labs Dismisses Partner Amid Drink-Spiking Allegations in Hong Kong
October 29, 2024
Visa and FV Bank Debut New Debit and Expense Cards, Bridging Crypto and Fiat Global Payments
October 29, 2024
Bitcoin Surges Past $71,000: What Could be the Possible Reasons?
October 29, 2024
Hong Kong Expands Tax Incentives to Include Virtual Assets, Targeting Institutional Investors
October 28, 2024
Dogecoin Surges Amid Musk and Trump Connections
October 28, 2024
Could Robinhood’s U.S.-Only Election Market Predict Results Better by Excluding Foreign Influence?