Bitcoin Closely Watching CPI Data, Looming FOMC Decision

Bitcoin prices dipped over the weekend amid an altcoin selloff but have since rebounded. The BTC/USD pair is up 1.55% and other cryptocurrencies edged higher on Monday, with digital assets primed to react to key macroeconomic forces in the coming days with the awaited US CPI inflation data and the decision on interest-rates by the FOMC.

Bitcoin is likely to move in tandem with the stock market this week, reacting alongside the Dow Jones Industrial Average and S&P 500 amid major macro news. Tuesday will see the release of the US consumer-price index for May; representing key inflation data, before Wednesday ushers in the next decision on interest rates from the Fed.

A dramatic rise in interest rates since March 2022 has been a driving force behind declines in digital assets, and Bitcoin’s rally this year, a rise of some two-thirds, has come amid expectations that rate increases will soon end and eventually reverse. Investors want to see the Fed hit the pause button on rates for the first time in this cycle, but also will scrutinize communications from the central bank on whether more rate hikes are likely to come in the months ahead.

Ether, the second-largest crypto, rose less than 1% to $1,750. Smaller cryptos or altcoins saw dramatic jumps after a weekend of deep selling. Cardano (ADA) is up 9% and Polygon (MATIC/USD is popping 7%.