#CryptoCPIWatch Monthly inflation projections:

Overall CPI: +0.3% month over month

Core CPI: +0.3% month over month

TD Securities analysts predict a widespread slowdown in inflation, noting that housing costs and goods prices may decrease, contributing to a relief trend.

How CPI data could affect the Federal Reserve's rate decision

The Federal Reserve has expressed caution regarding rate cuts, with Chairman Jerome Powell stating last week that economic conditions remain "solid," but inflation must cool further before considering monetary relief.

Markets have already priced in 85 basis points (bps) of rate cuts in 2025, but persistent inflation could force the Fed to maintain an aggressive stance. On the other hand, softer inflation data could solidify expectations for rate cuts to begin in June or July.

Impact scenarios:

CPI lower than expected (below 2.9%) → Fed rate cuts may accelerate, USD weakens, risk assets rebound (crypto, stocks).

CPI higher than expected (above 3.0%) → Fed maintains a restrictive policy, USD strengthens, stocks and cryptocurrencies decline.