The post FOMC and CPI Preview: Why the inflation reaction will be short-lived  appeared on BitcoinEthereumNews.com.

Cryptocurrencies dipped Tuesday while US equities posted mixed returns midway through Tuesday’s session as investors awaited inflation data and an update from the Federal Reserve.  Bitcoin and ether were each trading around 4% lower over 24 hours at time of publication, according to Coinbase. Bitcoin hovered around $66,900 after briefly breaching the $70,000 level Monday.  The S&P 500 and Nasdaq Composite indexes were mostly flat, losing 0.2% and gaining 0.15%, respectively, at time of publication.  Federal Open Market Committee members gathered Tuesday morning for the first day of their two-day policy setting meeting. Central bankers are expected to release their interest rate decision and projections Wednesday at 2 pm ET. Investors banking on a return in equities this week may be disappointed, analysts say.  Read more: The US crypto industry is bouncing back after rough regulatory year “From 1994 to 2011, the S&P 500’s entire return came during FOMC meeting weeks,” Nicholas Colas, co-founder of DataTrek Research, wrote in a note Tuesday. “This ‘Fed Drift’ has waned in the 2020s. Over the last 18 months, the S&P’s win-rate from Tuesday – Thursday of a Fed week is only 45%.”  The US Bureau of Labor Statistics is also slated to release the latest Consumer Price Index (CPI) report Wednesday morning. Analysts from JPMorgan are calling for May’s month-over-month figure to show around a 0.3% increase in prices, which should have minimal impact on markets.  UBS analysts are similarly expecting the yearly inflation figure to come in similar to the last read of 3.4% recorded in April, which should be enough to convince investors that prices are in fact trending lower.  The CPI report is “still one of the most important monthly economic reports because the Fed can’t cut until there’s more progress on falling inflation; its impact will be lessened by…

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Filed under: News - @ June 11, 2024 9:22 pm