The release of Consumer Price Index (CPI) data is anticipated as a pivotal event that may affect financial policies and the cryptocurrency market.
How Could Lower Inflation Rates Affect Fed Policy?
Decreasing inflation rates could prompt the Federal Reserve to accelerate interest rate cuts. If the annual inflation rate falls below the 2.4% threshold, it may lead to cheaper borrowing costs and shift investments toward cryptocurrencies. Analyst Paul Barron believes moderate inflation data could rekindle interest in the cryptocurrency market.
Pressure on the Fed and Cryptocurrency Legislation
The Federal Reserve is under pressure from President Trump, who demands interest rate reductions. At the same time, the costs for the renovation of the Fed's headquarters have soared. Congress is seeking clarifications on the budget increase. During the forthcoming 'Cryptocurrency Week,' the House of Representatives will vote on key bills regarding crypto regulation.
Bitcoin in Light of Economic Changes
Paul Barron predicts that if the CPI data turns out to be favorable, Bitcoin could reach the $130,000 mark. It is expected that cryptocurrencies like Ethereum and XRP might become attractive to investors due to potential regulatory changes.
The CPI release and cryptocurrency regulation may lead to significant changes in the financial markets in the coming months.
