Inflation Data Impacts Fed Rate Decisions

Meaning: New inflation figures are influencing the US Federal Reserve’s stance on interest rate policy.

Causes:

If inflation is lower than expected → Fed may cut rates sooner, increasing liquidity and potentially fueling risk assets like crypto.

If inflation is higher → Fed may delay cuts or raise rates, reducing market risk appetite.

Implications:

Crypto prices, especially Bitcoin and Ethereum, often react strongly to expectations of looser or tighter monetary policy.

Lower rates are generally bullish for crypto, while higher rates may cause short-term pullbacks.