After a massive five-week rally that increased its price by nearly 40%, Bitcoin (BTC) has been stalled around $37,000 for the past few days. To the extent that the enthusiasm around the possible approval of a spot Bitcoin ETF has run out of some fuel, bulls may be looking to Tuesday’s Consumer Price Index (CPI) as a new catalyst.
Economists expect monthly headline CPI in October to slow to 0.1% from 0.4% in September. Annual CPI is expected to decrease from 3.7% to 3.3%. Core CPI, which excludes food and energy costs, is expected to remain flat compared to September – 0.3% monthly and 4.1% annually.
Both indicators are well above the US Federal Reserve’s 2% target. While the Central Bank stated that inflation did not need to fall to 2% in order to end interest rate hikes and consider interest rate cuts, the speakers clearly stated that they wanted to see continued progress towards this target.
Koinfinans.com As we have reported, to the extent that higher interest rates compete with risk assets for investor dollars, the idea of a lower interest regime could provide a shot in the arm for BTC. Of course, the opposite is also true and if tomorrow’s inflation report comes in faster than expected, crypto- prices are likely to give back more of their progress in October.