The core personal consumption expenditures (PCE) data was recently released by the Bureau of Economic Analysis, with results showing a 0.4 percent increase in the PCE price index for April 2023 compared to the previous month. Even more notably, the PCE price index, excluding food and energy, increased by 4.7 percent from one year ago. Despite the core PCE index usually affecting high-risk assets like Bitcoin, the crypto market demonstrated little reaction to these inflation figures.
Market participants are paying more attention to the possibility of a debt ceiling deal, rather than focusing on the recent PCE data. Inflation in April exceeded expectations, potentially giving the US Federal Reserve an additional reason to pursue their policy of monetary tightening. This is primarily due to concerns over a liquidity crunch in regional banks. When it comes to making decisions about interest rate hikes, the US central bank takes core PCE inflation data into consideration. The next scheduled Federal Open Market Committee (FOMC) meeting is on June 13-14, 2023.
Although the crypto market has not significantly responded to the current PCE inflation data, it is important for investors to understand the implications of this information. The 4.7 percent year-over-year increase in the core PCE price index is higher than the market expectation of 4.6%. Despite this, Bitcoin’s price has remained relatively stable, hovering around the $26,500 range. On the other hand, US stock futures experienced a slight uptick as a result of the PCE numbers.
In other crypto market news, Binance has ceased Australian Dollar (AUD) trading pairs for Bitcoin and other cryptocurrencies. Meanwhile, Thailand has granted a digital asset license to Binance Exchange.
As always, it is essential for investors to conduct thorough market research before investing in cryptocurrencies. Factors such as PCE inflation data, monetary policy decisions, and overall market sentiment should be taken into account when making investment choices. Remember, the author and the publication are not responsible for personal financial losses resulting from individual investment decisions.
In conclusion, while the crypto market may not have shown a strong reaction to the latest PCE inflation data, this information should not be disregarded by investors. The potential for monetary tightening by the US Federal Reserve and other factors can play a significant role in determining the future of cryptocurrencies like Bitcoin. Investors should remain vigilant and stay informed about market trends and developments to make well-informed investment decisions.
Source: Coingape
