The spotlight is on the upcoming Wednesday, June 12, the anticipated date for the U.S. Federal Reserve’s decision on whether to adjust interest rates.
Despite the strong employment numbers from May, it is widely expected that the Federal Reserve will leave interest rates untouched during this week’s session, maintaining them at the 5.25% to 5.5% bracket for the seventh straight meeting.
The forecast is that officials might scale back the amount of anticipated reductions for the year after considering a range of economic indicators with varying implications.
What’s on the Economic Schedule for June 10-14
June 12 promises to be a hectic day with the release of core Consumer Price Index (CPI) figures. This inflation gauge significantly influences the Federal Reserve’s decisions on monetary policy and interest rate shifts.
An uptick in the CPI typically signals rising inflation, which may compel the Fed to increase or hold interest rates steady. Current projections indicate that the year-on-year CPI will maintain at 3.4%, reinforcing the expectation of no change in interest rates this week.
Throughout this year, there’s been a noticeable link between Bitcoin prices and CPI data, as reported by CryptoPotato in May. Digital currencies have generally experienced downturns with higher-than-anticipated CPI results, while lower figures have had a bullish effect.
This Week’s Critical Events:
1. OPEC Monthly Report – Tuesday
2. May CPI Inflation data – Wednesday
3. Decision on Fed Interest Rates – Wednesday
4. Fed Press Briefing – Wednesday
5. May PPI Inflation data – Thursday
6. MI Consumer Sentiment reports – Friday
A crucial week looms with…
— The Kobeissi Letter (@KobeissiLetter) June 9, 2024
The subsequent day, Thursday, June 13, will witness the publication of core Producer Price Index (PPI) data. This metric tracks changes in the sale prices for domestic producers of goods and services over time and serves as an important secondary inflation marker for the Federal Open Market Committee (FOMC) in their policy decisions.
“The Federal Reserve is looking for consistent data that bolsters its assurance that inflation is heading towards its 2% target steadily,” commented Ryan Sweet, the lead economist for the U.S. at Oxford Economics.
Market analysts are predicting that the central bank’s first rate decrease might occur during their September session, which will also be its last before the presidential election on November 5.
Implications for the Cryptocurrency Market
Speculations suggest that the upcoming Fed rate decision may already be accounted for within the crypto markets, given the prevailing consensus that rates will stand pat.
A modest amount of turbulence could occur mid-week, but overall, a static trend is anticipated to prevail. Bitcoin’s dominance might result in a dip for alternative cryptocurrencies, delaying any possibility of an ‘altseason’ for the time being.
A well-known crypto trader, referred to as ‘Emperor’, shared his perspectives on the market’s condition, addressing his 390,000 followers on Twitter on June 9.
Assessment of the Crypto Market.
Are we in a state of confusion? Undoubtedly.
One part of us anticipates rate cuts by the Fed, which could boost the market.
Conversely, recent celebrity scams have suggested a market peak.
My approach is straightforward.
If we witness a decline to the 67-68K zone,…— Emperor👑 (@EmperorBTC) June 9, 2024
Image Source: Chinnapong / Shutterstock
