Strong Job Growth Raises Questions
Concerns regarding a potential Federal Reserve tightening of monetary policy have been raised in light of the recent spike in employment. With rising employment, the Fed’s goal of maintaining inflation at 2% may be tested.
The cryptocurrency market stabilizes in January.
In January 2023, the cryptocurrency market had stability following a turbulent year in 2022. Cryptocurrency prices have mostly remained constant at their present levels despite the market’s continued difficulties.
Growing Threat from Inflation
Inflation levels in the most recent quarter were greater than anticipated, according to recently updated consumer pricing statistics. In December 2022, inflation increased by 0.1% as opposed to falling as predicted. The supply dynamics are favorable for both an increase and a fall in the Consumer Price Index, which means that this development might have a substantial influence on the cryptocurrency market (CPI).
The Effect of Inflation on the Crypto Market
Increased investment in cryptocurrencies as a cost-hedging measure might result from growing consumer prices in the US. In contrast, a rise in inflation may cause less money to come into the cryptocurrency market. A Reuters survey indicates that a 0.4% month-over-month increase in the CPI and a 0.4% increase in the core CPI are anticipated for January. Despite an euphoric mood in the cryptocurrency market before to the release of the December CPI data, there was some controversy once the data was made public.