The Federal Reserve Bank of the United States is currently involved in an economic war. They have declared open warfare on combating rampant inflation that has plagued the economy since Covid started and excessive money printing occurred on an unprecedented scale. It has been calculated that just in the year 2020 alone, 20% of all dollars were created in that year. This massive supply of liquidity has been speculated to have been partly the reason for the massive bull run that occurred in 2021 where just about every asset class rocketed to the moon.

We are now in the hangover phase and rampant inflation is the symptom. The Federal reserve began rapidly raising rates and as is the historical norm, when rates rise, risky asset classes such as stocks and crypto decrease in value. An important benchmark that the Federal Reserve uses to gauge how fast or slow to raise rates is the CPI report which is due to be released at 8:30am tomorrow EST. The CPI is an acronym for “Consumer Price Index” and measures in a percentage the current rate of inflation for the month prior.

If the CPI number comes in hot, meaning its higher that what was forecast then stocks and crypto theoretically should take a bit of a nosedive, depending on how far off the actual number is. Conversely, if the number is lower then we can expect stocks and crypto to rally and we will see higher prices.

If you are just hodling then this won’t mean much to you as you are in for the long haul, however if you are actively trading crypto then you should pay close attention to this report as it will definitely move prices tomorrow. 

Once again I remind you that this is not financial advice , its just me urging crypto and stock investors to be reminded that an important economic report is due tomorrow and it will move prices, maybe significantly.

Good luck everyone!

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The_CryptoGuru