Last Friday, strong US jobs data dampened the sentiment of 50 bps rate cuts during the November FOMC meeting. The US CPI data for September will arrive this Thursday, October 10, and will be a major indicator of the future market trajectory. This is a crucial macro indicator to help the Federal Reserve steer its ship.
As per the market estimates, the CPI numbers will cool down to 0.1% in September, dropping from 0.2% in the previous month. Additionally, the inflation is likely to stay around 2.3%, dropping from 2.5% in the previous month. The expectation of this cooling inflation is what boosts the crypto market.
Meanwhile, the Core CPI, which excludes volatile energy and food prices, is anticipated to reflect a slower inflation rate of 0.2%, down from 0.3% the previous month. Despite this, the annual Core CPI is projected to hold steady at 3.2%.
In this week ahead, a number of Fed officials will be speaking on the matters of inflation and the future trajectory ahead. Previously, Fed Chair Jerome Powell expressed optimism about easing inflation in the US, while other officials have signaled support for a more substantial rate cut of 50 basis points at the Fed’s meeting later this year.
Bitcoin and Altcoin Rally
Bitcoin and altcoins have started the week on a strong note ahead of the US CPI release. Crypto investors have been eagerly waiting on the sidelines for the Uptober rally while expecting the start of the next bull rally.
Going against market expectations, Bitcoin and altcoins faced a major pullback in the first week of October. However, BTC price has bounced back strongly from the lows of $59,800 last week. Some market analysts believe that the recent recovery sets the stage for a 32% BTC price rally from the bottom while expecting new all-time highs in October.
BTC typically bottoms 3-4 days into October
From the bottom to the end of October, BTC is up 32% (36% if you exclude Octobers that have a negative return)
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Bhushan is a FinTech enthusiast and holds a good flair in understanding financial markets. His interest in economics and finance draw his attention towards the new emerging Blockchain Technology and Cryptocurrency markets. He is continuously in a learning process and keeps himself motivated by sharing his acquired knowledge. In free time he reads thriller fictions novels and sometimes explore his culinary skills.