Now, these same central banks are struggling to contain the rise in the general price level. And for that, their weapon is called interest rates.
US inflation: down in July!
After a month of June that had seen 12-month inflation climb to 9.1%, the markets were expecting a slowdown in July. But to a lesser extent. The announcement of inflation at 8.5% was therefore perceived very positively by the markets, which were counting on a consensus of around 8.7%.
This small difference ultimately makes it a big one in the markets. Whether on the equity markets or on the crypto markets. But above all, it marks a break between reality and forecasts.
Indeed, in recent months, the actual figures have tended to be worse than the consensus established by the various banks and economic analysts.
Anyway, the markets are likely to be also impacted by the next publication of the August figures. But for that, we will have to wait until Tuesday, September 13.
These figures will notably make it possible to determine whether inflation is tending to fall or whether the rate is beginning to form a plateau around 8.5 - 9%.
In the event of a further decline, it is a safe bet that the markets will display euphoria. In the coming days, certain macro variables such as July's Chinese industrial production or Great Britain's GDP will also allow the markets to adjust.
Bitcoin is approaching $25,000!
As the graph below illustrates, the announcement of the inflation rate at 8.5% had an immediate effect on the price of Bitcoin:
In the space of a few minutes, the mother of cryptocurrencies goes from 23 to more than 24,000 dollars. A pump that seems to set the tempo for today's session. At the time of writing, Bitcoin is trading against $24,526, a price level that was touched on July 30.
Many analysts consider it likely that Bitcoin could attempt to breach the $25,000 resistance level today. In such a scenario, Bitcoin would be at its highest for 2 months.
Ethereum is approaching 2,000 dollars, and the altcoins are celebrating!
The announcement of the level of inflation also had an impact on the price of Ethereum.If Ether drew on the threshold of 1,800 dollars, the good news coming from the other side of the Atlantic allowed the token to break this price level.
As with Bitcoin, the rise set the pace for today's session. The following table shows the price of the 5 main altcoins and their evolution over the last 24 hours:
Driven by the imminent arrival of The Merge, Ethereum is still the engine of the market. The second crypto valuation is also approaching half of Bitcoin's marketcap. And Ethereum Dominance is currently very strong, very close to 20% (19.9).
Among the main altcoins, we will also note the good health of Solana which takes almost 12%. Polkadot (+8.1%) and Avalanche (+6.9%) are also in good shape. Unlike BNB and XRP which underperformed the market on Thursday.
Over the day, the crypto market has just recovered 6.34%. For a global marketcap which now weighs 1,150 billion dollars if we are to believe data from the Coinmarketcap platform.
Equity markets are also benefiting from the drop in inflation!
In France, the slowdown in inflation pushed the CAC 40 to a rebound close to 6,500 points. Same observation across the Atlantic where the S&P 500 gained more than 2% in yesterday's session after opening sharply higher.
The Nasdaq follows the same trend as the S&P 500 with an increase of 2.85%. Same observation for the Dow Jones which shows a more moderate increase: 1.63%.
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