Traders are bracing for U.S. Consumer Price Index data this week, with a positive print likely influencing Bitcoin’s next price rise, analysts say.
Coupled with strong nonfarm payroll numbers, the “Uptober” narrative has helped buoy support for the world’s largest crypto at around $60,000, according to digital assets firm QCP Capital.
“After a shaky start, Uptober seems to be back on track,” QCP Capital wrote in a note on Monday. “Bitcoin is as at similar levels to where it started last Monday.”
Bitcoin has dipped 2% to $62,570 after briefly touching $64,000 on Monday, while Ethereum has slipped 3% to $2,432, data from CoinGecko shows.
CPI is projected to rise by just 0.1% in September, marking the smallest increase in three months. On a year-over-year basis, the CPI is expected to climb 2.3%, reflecting the sixth consecutive slowdown and the lowest level since early 2021.
“All eyes are on US CPI,” QCP wrote. “With the recent strong US wage and jobs numbers, the market will be paying close attention to this print for any signs of an uptick in inflation.
The CPI helps the Federal Reserve assess inflation.
A rise could lead to higher interest rates to curb spending, which often pressures risk assets like Bitcoin as investors shift to safer investments. Conversely, a lower CPI might signal room for rate cuts, which could benefit risk assets by encouraging more speculative investments.
As inflation impacts the Fed’s decisions on rates, it also directly influences how investors approach Bitcoin and other cryptocurrencies.
Anndy Lian, an author and intergovernmental blockchain expert, told Decrypt that the anticipation around the CPI data has already had an impact, as Bitcoin rebounded from its $60,000 low and is now positioning itself for a potential rally.
“In the past, Bitcoin has been volatile in response to CPI data,” Lian said. “Positive CPI results, reflecting a strong economic environment, have often led to price increases.
On the other hand, higher-than-expected inflation data could raise concerns about stricter monetary policy, which might adversely affect Bitcoin’s price, Lian said.
Source: https://decrypt.co/285073/bitcoin-traders-eyeing-this-weeks-cpi-data
Anndy Lian is an early blockchain adopter and experienced serial entrepreneur who is known for his work in the government sector. He is a best selling book author- “NFT: From Zero to Hero” and “Blockchain Revolution 2030”.
Currently, he is appointed as the Chief Digital Advisor at Mongolia Productivity Organization, championing national digitization. Prior to his current appointments, he was the Chairman of BigONE Exchange, a global top 30 ranked crypto spot exchange and was also the Advisory Board Member for Hyundai DAC, the blockchain arm of South Korea’s largest car manufacturer Hyundai Motor Group. Lian played a pivotal role as the Blockchain Advisor for Asian Productivity Organisation (APO), an intergovernmental organization committed to improving productivity in the Asia-Pacific region.
An avid supporter of incubating start-ups, Anndy has also been a private investor for the past eight years. With a growth investment mindset, Anndy strategically demonstrates this in the companies he chooses to be involved with. He believes that what he is doing through blockchain technology currently will revolutionise and redefine traditional businesses. He also believes that the blockchain industry has to be “redecentralised”.
