Today, the markets focused on the Producer Price Index (PPI), which fell short of expectations last month. Considering that the producer cost is reflected to the consumer at a higher price, this data will be one of the strongest indicators of inflation.
Producer Price Index in the USA was announced at 16.30 TSI; With the increase in costs in the service sector and food sector, it was above the expectations with 0.3% monthly and 7.4% annually. With very little time left until the last FOMC meeting of 2022, it is very possible that the Consumer Price Index data to be announced on Tuesday will strongly move the markets. “The time may come at the December meeting to slow our rate of increase,” Fed Chairman Powell said in his speech last week. He gave the signals that a slowdown in the rate of increase in interest rates might come with an increase of 50 basis points. If the annual CPI is below 7.7%, we will think that the economy has started to cool down as a result of interest rate hikes, but if the annual CPI is announced above the 7.7% expectation, it can be predicted that the rate hike will continue in the first half of 2023.
The Cryptocurrency Market Does Not Stand Still
US stock markets opened negative today. Although there was a selling pressure in the crypto money markets after the incoming data, the decline did not deepen. A noticeable decline in inflation will also have a positive effect on the crypto market.
Assets that are considered ‘risky investments’ such as cryptocurrencies need to restore confidence in order to increase risk appetite on the part of investors, but dust clouds continue to fluctuate on the paths of the crypto market to the bull period. This week, we watched closely the bickering between FTX founder and former CEO Sam Bankman-Fried and Binance CEO Changpeng Zhao. We predict that the waters will not calm down next week.
Bitcoin (BTC), on the other hand, has increased by 1.5% since yesterday, trading at $ 17,160, gaining 1.52% on a weekly basis. Ethereum, on the other hand, is up 2% in the last 24 hours, trading at $1,275.
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