US Inflation Data Looms: How Will Crypto Market React To The CPI Report on 10th May – Coinpedia Fintech News

US Inflation Data Looms: How Will Crypto Market React To The CPI Report on 10th May – Coinpedia Fintech News

May 8, 2023

This week, the US Consumer Price Index (CPI) inflation data is expected to be released, with headline figures anticipated to remain at last month’s +5.0% YoY. However, the monthly inflation rate is expected to accelerate to +0.4% (from the previous +0.1%), while core inflation may experience a slight dip, decreasing to +0.3% (from the previous +0.4%).


A Risk-Friendly Forecast for Next Month

Compared to previous months, this month’s numbers are relatively flat, suggesting that no significant market movement will occur unless there’s a substantial deviation from the predicted figures. However, the upcoming month’s data is predicted to be more risk-friendly, with both core and headline inflation expected to decline notably.

Bitcoin Experiences Decline, Volatility Still High

The cryptocurrency market has hinted at the emergence of a bull market, but there has been a noticeable cooling off in the market lately. Bitcoin, the top crypto, endured a series of setbacks over the weekend, plunging below $28,000 for the first time in roughly a week.

Bitcoin Bears Take The Reigns

This heightened volatility culminated in Bitcoin approaching $30,000 last Friday night. However, as market bulls geared up to breach this crucial resistance level, the bears sprang into action, thwarting any further increases. Instead, Bitcoin’s value plummeted, dipping below $28,500 on Saturday.

Related: Bitcoin Network Record High Congestion Caused by Huge Demand for BRC-20 Tokens – Coinpedia Fintech News

Bitcoin Struggles to Reclaim Value

Sunday’s trading was less dramatic, with Bitcoin hovering around $29,000 for most of the day. However, as the weekend came to a close, the market took another turn for the worse. Bitcoin’s value tumbled by an additional $1,000, dipping below $28,000 to hit its lowest point in a week. At the time of writing, the digital currency is still struggling to reclaim that level, with its market cap shrinking to $540 billion and daily losses of 3.5%. 

Bitcoin’s dominance over the altcoin market remains relatively stable at 47%. Ethereum, the second-largest cryptocurrency, mirrored Bitcoin’s decline, dropping to $1,850. 

Other major digital assets like Binance Coin, Cardano, Dogecoin, Solana, Tron, and Litecoin suffered losses in the range of 4 to 10%.

US CPI Inflation Data Release

As the US CPI inflation data release approaches, its potential impact on the cryptocurrency market remains a topic of interest for investors. While the numbers are expected to be relatively flat this month, any significant deviation from predictions could potentially trigger further market volatility.

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