CPI data interpretation
Today is different from the past. The impact of the US macro data on the cryptocurrency market is getting bigger and bigger, especially the expectations of the Fed's interest rate cuts from the CPI tonight. The CPI, which is what most people call inflation, is 3.4%. The market expectation is 3.4%, and the Cleveland Fed's expectation is also 3.4%. So when the actual value is less than 3.4%, it is good for the market.
Five and a half hours after the release of CPI, the Fed will hold its interest rate meeting. The Fed's main focus in this interest rate meeting is the dot plot, so the impact of the CPI data before the meeting may be diluted.
If the CPI data is higher than 3.4%, then there is no doubt that it will be a blow to the market. In addition to the CPI, there is also a core CPI tonight. The Fed is more concerned about the core CPI, so the core CPI will be more important, but many people in the market do not understand this core CPI, so the band caused by CPI may be larger.
Of course, if the core CPI data is very good, it will also reverse some views on CPI. The previous value of the core CPI is 3.6%, and the expectation is 3.5%. Similarly, lower than expected is good news, higher than expected, equal to the previous value, or higher than the previous value is not a good thing, the latter will be more bearish.
In addition, the two-month rate also has an effect, but the effect is slightly lower than the two annual rates of CPI.
The focus is still on the Fed's interest rate meeting in the early morning. The dot plot definitely indicates the direction of the next rise and fall.
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