The crypto market is largely unaffected. A decrease in consumer inflation may spark optimism, but it has little impact on the crypto markets.
After the most recent release on July 12, the U.S. Consumer Price Index has hit its lowest level in two years. According to the U.S. Bureau of Labor Statistics the CPI increased by only 3% in June compared to last year.
This decline can be attributed mainly to the low consumer prices and the high base effects from the same period last year.
But 3% inflation does not mean the world’s central banks have stopped raising rates. In fact, 3% inflation is above the Fed’s mandated range, which could mean more rate hikes.
CPI at Two-Year Low
Dow Jones had projected that both the year-over-year change and the month-over-month change would be below their estimates. The new figures, however, have exceeded those expectations. The change from one year to the next was expected at 3.1%. However, it remained at an impressive 3%.
The change month-over-month was also projected at 0.3% but only grew by 0.2%. These results highlight that the Fed’s efforts to combat inflation are starting to take effect. It is important to remember that inflation remains high and could possibly rise again.