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Cryptocurrency investors did not have a good day on Friday on the macro front. However, the fog is now lifting. In a few hours, the Fed will announce the interest rate decision and long-term interest expectations. Yesterday’s inflation data brought some relief to investors. Today’s data could be the leading signal for an uptrend.
Cryptocurrencies Could Rise
In November, inflation dropped slower than expected due to fluctuations in oil prices. However, the US Consumer Inflation data that came out a few minutes ago is extremely important. The Producer Price Index (PPI) on an annual basis was expected to retreat to 1%, but it was announced as 0.9. The core PPI came in at 2% against the expectations of 2.2%. This significant drop in core inflation from the previous month’s 2.4% will positively affect the consumer inflation for the following month.
Despite not caring much about the latest good data, BTC continues to see inflation decreasing. With the latest PPI data, it is not hard to expect that the December inflation data, which will be released in January, will also be positive. If the interest rate expectations to be announced in a few hours are not as bad as feared and if Powell moves away from an overly hawkish stance, the rise in crypto could continue.
In conclusion, since the PPI data reflects a decrease in inflation, it suggests that the macroeconomic pressure may not push crypto down further in the medium term.
