All eyes are on Wednesday, June 12, which is the date of the U.S. central bank’s policy decision on interest rates.
However, the Federal Reserve is likely to keep interest rates unchanged this week, following strong jobs data for May.
Policymakers are almost certain to keep rates at the 5.25% to 5.5% range for a seventh consecutive meeting.
They could also reduce the number of cuts slated for this year as policymakers digest a mixed bag of economic data.
Economic Calendar June 10-14
June 12 will be a very busy day with core CPI (consumer price index) reports to be released. This data is a key measure of inflation in the economy, it has a significant impact on the Fed’s monetary policy decisions, including interest rate adjustments.
A higher CPI reading indicates increasing inflation, which typically puts pressure on the Fed to raise interest rates or keep them the same. The year-on-year CPI figure is likely to remain the same at 3.4%, suggesting that the central bank will not change rates this week.
There have been strong correlations between Bitcoin price and CPI data this year, as reported by CryptoPotato in May. Higher-than-expected CPI has been bearish for the digital asset, while lower-than-expected CPI has been bullish.
Key Events This Week:
1. OPEC Monthly Report – Tuesday
2. May CPI Inflation data – Wednesday
3. Fed Interest Rate Decision – Wednesday
4. Fed Press Conference – Wednesday
5. May PPI Inflation data – Thursday
6. MI Consumer Sentiment data – Friday
It’s Fed week with…
— The Kobeissi Letter (@KobeissiLetter) June 9, 2024
Thursday, June 13, will see core PPI (producer price index) reports released. This measures the average change over time in selling prices received by domestic producers of goods and services and is a valuable complimentary inflation indicator used by FOMC policymakers.
“The Fed is waiting for a string of data that strengthens its confidence that inflation is on a sustained path toward its 2% target,” said Ryan Sweet, chief US economist at Oxford Economics.
Analysts expect the first rate cut to happen at the central bank’s September policy meeting, its final gathering before the November 5 presidential election.
“It [the Fed] should project two rate cuts this year and a cutting cycle that begins in September,” Bank of America economists wrote in an investor note published on Friday.
Crypto Market Impact
The Fed rate decision is likely to be already factored into crypto markets since it is almost a given that rates will remain unchanged.
There may be a little volatility mid-week, but the sideways momentum is likely to continue. Altcoins may take a hit, however, as Bitcoin dominance remains high, keeping the premise of altseason at bay for now.
Crypto trader ‘Emperor’ shared his thoughts on the state of the market with his 390,000 followers on X on June 9.
Crypto Market Check.
Is the Market in a Confusing Position right now? Yes.
On one Side we expect the Fed to cut the rates, making the Market Pump.
On other side, we have Celebrity Scams in the market, calling for a Top.
My thinking is Simple.
If we Drop to 67-68K Region,…— Emperor👑 (@EmperorBTC) June 9, 2024
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