“This is where the deflationary impulse from falling oil prices should remind everyone that the Fed is not going to raise interest rates and that — instead — the next move will be a cut,” Robin Brooks, a senior fellow at the Brookings Institution and former chief economist at the Institute of International Finance, said in a report.
If the currency’s strength is in question, then the barrier to Bitcoin’s upside also appears lower. We know that the two are inversely correlated.
However, some observers call for caution, believing that the market overestimates the impact of oil prices on inflation. According to them, high price pressures are now a structural problem.
“The Fed can’t claim victory just because gas prices are falling. Persistent service-sector inflation is exactly why policymakers will likely keep rates high for longer, even as headline CPI continues to moderate,” YCC Macro on X said.
Markets betting on aggressive easing may be underestimating the persistence of underlying inflation,” YCC Macro added. Stay alert!
Read more: For analysis of current altcoin and derivatives activity, see Crypto Markets Today. For a full list of this week’s events, check out CoinDesk’s “Crypto Week Ahead.”
