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Today hosts two major developments. The first, announced by Trump just minutes ago, involves significant international trade agreements. The second concerns the recently disclosed U.S. inflation data, which has caught the attention of cryptocurrency enthusiasts eager for ongoing market momentum. As altcoins experience increased pressure, questions arise: what does the inflation data signal for the future of cryptocurrencies?
Impact of U.S. Inflation on Cryptocurrencies
U.S. inflation surged to 9% following the pandemic-induced monetary expansion but has been tamed by the Federal Reserve’s assertive interest rate hikes. The Fed has consistently pursued a tight monetary policy in a bid to stabilize inflation around 2%, and noteworthy progress has been made. Headline inflation reduced to 2.3% in April, with core inflation recently reported at 2.88% last month.
Despite this success, a global 10% tariff is expected to drive a temporary rise in inflation. Today, Trump announced an agreement with China leading to a total 65% taxation on trade, consisting of a 55% increase on top of the existing tariff. This will inevitably impact goods and services prices, potentially raising inflation, although declining fuel prices might mitigate this to some extent. Goldman Sachs projects core inflation to shoot up by 0.35% over the coming months. Meanwhile, the Personal Consumption Expenditures (PCE) index, which is substantial for monetary policy decisions, will be released on June 27.
Current Inflation Insights and Future Predictions
Today’s data reveals the following:
- U.S. Inflation Announced: 2.4% (Expected: 2.4%, Previous: 2.3%)
- Core Inflation Announced: 2.8% (Expected: 2.9%, Previous: 2.8%)
While inflation is poised to climb, this rise isn’t immediately on the horizon. Contrary to expectations, core inflation hasn’t increased from the previous month. If strategic measures can mitigate tariff impacts, the path may open for the Fed to possibly reduce interest rates.
With the PCE data anticipated at the month’s end, a lower-than-expected figure could set a favorable tone for cryptocurrencies as July commences.
Currently, Bitcoin 
$105,345 teeters on the edge of the $110,000 mark.
