Buyers anticipate the Federal Reserve will minimize rates of interest later this yr.
Crypto markets rallied on Thursday after knowledge revealed that U.S. inflation fell to its lowest stage in over three years throughout June.
In accordance to the Labor Division, the patron value index (CPI) — which measures the price of items and companies — fell by 0.1% in June. This lowered the annual fee to three%, the bottom it has been since April 2021. Excluding meals and vitality costs, the core CPI elevated by 0.1% for the month and three.3% year-over-year.
These knowledge got here in decrease than anticipated, with Dow Jones analysts beforehand tipping a 0.2% month-to-month rise and a 3.4% annual enhance, based on the Bureau of Labor Statistics.
The inflation dip offers the Federal Reserve with extra room to probably lower rates of interest later this yr.
The information additionally comes after Jerome Powell, the chair of the Federal Reserve, hinted at potential fee cuts throughout his congressional testimony on Tuesday. Powell warned that extended excessive rates of interest might hurt the U.S. financial system, and famous {that a} cooling labor market signifies that inflationary strain is easing.
Crypto markets react
Bitcoin (BTC) responded with a 2% value bounce within the final 24 hours to commerce above $59,000, whereas Ethereum (ETH) climbed by 3% to check $3,200.
The rally prolonged a digital asset restoration after the violent weekend sell-off.
BTC dropped by 16.5% to a low of $53,500 on July 5 after tagging a neighborhood excessive of $63,800 on July 1. Glassnode, an on-chain analytics platform, described the dip as Bitcoin’s “deepest correction since late 2022.”
“Between Might and July, the market skilled its deepest cycle correction, recording a drawdown exceeding -26% from the all-time excessive,” Glassnode mentioned in a July 7 report.
Among the many prime 100 cryptocurrencies by market cap, Stacks (STX) led with a 12% acquire in a single day. ZkSync (ZK) and Aave (AAVE) additionally carried out properly, rising by 6.5% and 6.1% respectively. Polkadot (DOT) and Solana (SOL) each rebounded by 0.5%.
Over the previous 24 hours, 34,000 crypto merchants had been liquidated, totaling $96 million in liquidations, in accordance to knowledge from CoinGlass. Regardless of the bullish market momentum, lengthy positions accounted for 57% of the margin calls.
Within the inventory market, futures tied to the S&P 500, Nasdaq 100, and Dow Jones Industrial Common all jumped by 0.3%.
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