#HotJulyPPI In the last 6 months, inflation in the U.S. has shown a downward trend, although with some fluctuations. The annual Consumer Price Index (CPI) stood at 2.7% in July, remaining at a moderate level.
The impact on the cryptocurrency market has been significant, as inflation data is a key factor in the Federal Reserve's (Fed) monetary policy decisions. When inflation cools, expectations for interest rate cuts increase, which generally drives investors towards riskier assets like cryptocurrencies. Conversely, a higher than expected CPI can create uncertainty and lead to declines in the market.
The Producer Price Index (PPI), which measures wholesale prices, has followed a similar trajectory, although with some differences. The annual PPI for July, which recorded a 3.3% increase, exceeded market expectations, influencing the volatility of cryptocurrencies.