The Consumer Price Index (CPI) and the Producer Price Index (PPI) for August have both been released this week. The PPI report shows that wholesale prices rose by 0.2% month-on-month, slightly higher than economists' expectations, and rose by 1.7% year-on-year, in line with expectations. The CPI data was lower than market expectations.
A 25 basis point rate cut has become highly probable, increasing market expectations for a rate cut by the Federal Reserve next week.
Following the release of the data, financial asset prices have been trending higher, with leading cryptocurrencies, including BTC, entering a phase of rebound on the 12th, although profits are currently being retracted. The upcoming Federal Reserve interest rate decision meeting next week is crucial. The first rate cut after a period of high interest rates typically impacts the market, and it cannot be ruled out that the volatility of the cryptocurrency market will significantly increase next week. However, with the upcoming elections, some of the volatility may be offset.
If the Federal Reserve enters an orderly rate-cutting cycle, it will be favorable for risk assets. Rate cuts will lead to an increase in global money supply, enhancing market purchasing power and causing currency devaluation. This will further increase investors' risk appetite and seek asset appreciation.
The presidential debate has ended, but it is still uncertain who will win the US presidency.
Regarding the latest presidential election debate between Harris and Trump, the market is still in turmoil, with mixed opinions about the two candidates.
Trump, who uses cryptocurrency as one of his campaign tactics, has not provided any updates on how he plans to improve the lives of the American people. Voters are expecting him to present a fresh new narrative. Choosing JD Vance as the vice presidential candidate indicates that Trump's campaign focus remains on the "Rust Belt." However, his policies have not changed much, with the core still being the imposition of double tariffs on Chinese imports.
Harris has not made any specific statements directly related to BTC or cryptocurrency policies, so any impact is possible. The Democratic Party takes a more cautious approach to cryptocurrency, focusing mainly on regulation, consumer protection, anti-money laundering compliance, and combating bribery and market manipulation. Harris's administration may prioritize tightening regulations on cryptocurrency trading platforms, stablecoins, and DeFi platforms.
The four-year term of the US presidency coincides with a complete BTC cycle, and over the next four years under the leadership of the new president, BTC is destined to experience many unexpected events and significant price fluctuations.
The above views are from Matrix on Target. Contact usto obtain the complete Matrix on Target report.
Disclaimer: The market carries risks, and investment should be cautious. This article does not constitute investment advice. Digital asset trading may involve significant risks and instability. Investment decisions should be made after careful consideration of individual circumstances and consultation with financial professionals. Matrixport is not responsible for any investment decisions based on the information provided in this content.
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