The US will announce the first quarter core PCE price index at 8:30 tonight. What chain reaction will the release of this data have on the cryptocurrency market?

1. Impact of inflation expectations: If the PCE index reveals rising inflation, market expectations for the Fed's interest rate hike may rise accordingly. Interest rate hikes usually attract funds to safe-haven assets and reduce the pursuit of risky assets such as cryptocurrencies.

2. Monetary policy trends: The core PCE index is an important reference for the Fed to formulate policies. Once signs of inflation appear, the Fed may turn to tightening policies, which will put pressure on the market.

3. Market sentiment fluctuations: Investors' panic about inflation may change their attitude towards cryptocurrencies. If inflation triggers concerns about economic slowdown or policy tightening, investors may withdraw their investments in cryptocurrencies.

4. Liquidity considerations: Inflation data has a profound impact on market liquidity. High inflation may lead to liquidity contraction, which will have an impact on cryptocurrency assets that rely on liquidity.

5. Market outlook: As the key to market sentiment and Fed decision-making, the core PCE price index cannot be underestimated. The crypto market needs to pay close attention to its potential impact on investment sentiment.

In summary, every fluctuation in the core PCE price index may cause waves in the crypto market.