Tonight at 8:30 PM, the fate of the cryptocurrency market may be rewritten!
At 8:30 PM tonight, the U.S. March CPI data is about to be released, and the global financial market is on high alert. This data is not only related to the direction of the U.S. economy but will also have a significant impact on the cryptocurrency market and U.S. stocks.
1. The Fed's Dilemma
Currently, the Federal Reserve faces a tough choice. Tariffs are putting economic pressure on the country, and lowering interest rates could hedge risks, which would be a significant boon for the cryptocurrency market, increasing market liquidity and attracting funds into the crypto space. However, there are still inflation issues in the U.S., and raising interest rates to curb inflation could lead to funds flowing back to traditional financial markets, causing a withdrawal of funds from the cryptocurrency market and a price drop.
2. Impact of CPI Data
1. Higher than expected: If the March CPI data is higher than expected, inflation fears will intensify, and the likelihood of the Federal Reserve raising interest rates will increase significantly. This would be negative for the cryptocurrency market, leading to capital outflows, and cryptocurrency prices are likely to fall. U.S. stocks would also drop due to concerns over economic prospects.
2. Lower than expected: If the data is lower than expected, it indicates that inflation is under control, increasing the likelihood of the Federal Reserve lowering interest rates. This would be favorable for the cryptocurrency market and U.S. stocks, attracting funds into the crypto market, causing prices to rebound, while U.S. stocks would rise due to improved economic outlook and expectations of rate cuts.
3. Underlying Factors
Recently, tariffs have caused American citizens to rush to buy goods, leading to an imbalance in market supply and demand, and rising prices, adding uncertainty to the CPI data. According to analysis, the probability of this CPI data exceeding expectations is 60%, presenting some downside risks for the cryptocurrency market and U.S. stocks, and investors need to closely monitor market dynamics and manage risks effectively. $BTC
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