Powell sends dovish signals at the Jackson Hole annual meeting, suggesting that the Federal Reserve may lower interest rates in the future. Market expectations for a rate cut in September have risen to nearly 90%. The July PCE data has thus become a key basis for the Federal Reserve's decision-making.
The U.S. July PCE price index rose 2.6% year-on-year, with core rising 2.9%. Although this is above the 2% target, Powell mentioned or emphasized employment risks (current U.S. employment growth is slowing).
For the cryptocurrency market, the July PCE data is crucial:
• If the data is higher than expected, the likelihood of a rate cut in September may decrease, and funds could flow out of the cryptocurrency market into traditional safe assets, leading to a sharp decline in the prices of Bitcoin, Ethereum, and others, causing market panic and financing difficulties, potentially impacting projects.
• If the data is lower than expected, the likelihood of a rate cut in September increases significantly, market liquidity rises, and funds could flood into the cryptocurrency market, driving up prices. However, this may create a bubble, and if sentiment shifts later, investors may get trapped.
Currently, cryptocurrency investors are closely monitoring data trends, with some adjusting their positions and more adopting a wait-and-see attitude. The market is tense due to the approaching data, and rumors can easily trigger volatility. Investors need to be vigilant about risks.
The U.S. July PCE price index rose 2.6% year-on-year, with core rising 2.9%. Although this is above the 2% target, Powell mentioned or emphasized employment risks (current U.S. employment growth is slowing).
For the cryptocurrency market, the July PCE data is crucial:
• If the data is higher than expected, the likelihood of a rate cut in September may decrease, and funds could flow out of the cryptocurrency market into traditional safe assets, leading to a sharp decline in the prices of Bitcoin, Ethereum, and others, causing market panic and financing difficulties, potentially impacting projects.
• If the data is lower than expected, the likelihood of a rate cut in September increases significantly, market liquidity rises, and funds could flood into the cryptocurrency market, driving up prices. However, this may create a bubble, and if sentiment shifts later, investors may get trapped.
Currently, cryptocurrency investors are closely monitoring data trends, with some adjusting their positions and more adopting a wait-and-see attitude. The market is tense due to the approaching data, and rumors can easily trigger volatility. Investors need to be vigilant about risks.
