IMPORTANT CPI NEWS!
WHAT DO YOU NEED TO KNOW?⬇️
The Consumer Price Index (CPI) measures inflation. Here’s how it affects Bitcoin (BTC) and other cryptocurrencies:
1. If CPI is High (Inflation is Rising)
Effect on BTC: Prices may drop initially. High inflation increases the likelihood of the Federal Reserve raising interest rates, which makes the U.S. dollar stronger and reduces the appeal of riskier assets like BTC.
Reason: Investors may shift to safer assets (e.g., bonds, cash) due to higher borrowing costs and reduced liquidity.
2. If CPI is Low (Inflation is Slowing)
Effect on BTC: Prices may rise. Lower inflation reduces the chance of rate hikes, which can weaken the dollar and boost risk-on assets like BTC.
Reason: More liquidity in the market encourages investment in speculative assets, including crypto.
Key Takeaway:
BTC reacts to CPI based on market expectations about interest rates and liquidity. High CPI = bearish for BTC; Low CPI = bullish for BTC.
#CPIdata #BTC