The probability of interest rate cuts in September has increased, and the US PCE data in May is in line with the expected inflation slowdown! Why doesn’t Bitcoin rise?

This site (120BtC.coM): After the May CPI data and retail sales data released by the United States earlier this month showed that inflation has cooled down, the Ministry of Commerce announced another measure of inflation yesterday (28th) An important indicator, namely May PCE (Personal Consumption Expenditures Price Index) data, shows that inflation is slowing down again. Specifically:

2. The overall PCE in May was unchanged from the previous month, with a monthly increase of 0.3% in April; compared with the same period last year, the increase was 2.6%, and the annual increase in April was 2.7%. In line with market expectations.
3. Core PCE, which excludes volatile food and energy prices, increased by 0.1% in May. The monthly increase in April was revised upward from 0.2% to 0.3%. The core PCE annual growth rate, which has remained at 2.8% for three consecutive months, slowed to 2.6% in May, marking the smallest growth rate since March 2021.
4. Expert: The Fed is expected to start cutting interest rates in September

The Fed has frozen the federal benchmark interest rate at a range of 5.25% to 5.5% since July last year. Although Fed officials have made hawkish remarks many times before, claiming that they will only cut interest rates once at most this year, recent inflation data still give the market confidence that the Fed may start cutting interest rates in September and will cut interest rates twice this year.

5. Beth Ann Bovino, chief economist of U.S. Bank, said just after yesterday’s PCE data was released: We do expect the real economy to weaken, but it will not fall off a cliff, just weaken, which means that inflation will also be released in the future. slow. This gives us reason to expect that the Federal Reserve may start cutting interest rates in September. We all know it depends on the data, and the Fed is still waiting to see. Are they still waiting? Will there be only one drop this year? I can't rule it out, but the data seems to provide the Fed with a case for two rate cuts this year.
6. In addition, according to the CME Group’s FedWatch tool, the current market is also leaning towards the Fed starting to cut interest rates in September. The probability is 59.5%. It is believed that the probability of maintaining interest rates unchanged in September is only 34.1%.
7. As for the interest rate in December, the market predicts that the probability of the Fed cutting interest rates for the second time in December is 44%, and the probability of starting to cut interest rates in December is 30.4%. Almost no one predicts that the Fed will maintain the current rate in December. interest rate level.

US stocks surged

After the PCE news came out, all four major US stock indexes rose, with Philadelphia Semiconductor seeing the largest increase:

1. Dow Jones Industrial Index: up 0.12% or 45.03, at 39,209.25 points
2. S&P Index: rose 0.11% or 6.26, to 5,489.28 points
3. Nasdaq Index: rose 0.028% or 5.08, to 17,862.32 points
4. Philadelphia Semiconductor Index: rose 1.39% or 75.37, to 5,496.47 points

Bitcoin holds on to $61,000

In terms of cryptocurrency, the PCE news failed to save Bitcoin’s recent decline, and BTC even fell slightly; in addition, in the evening, the SEC announced that it would sue Consensys and claimed that Lido and other pledge projects were securities, exacerbating the market decline. , Bitcoin once fell below $61,000. At the time of writing, Bitcoin has rebounded to $61,040, but the trend is still unclear.

Ethereum has the same trend and has fallen below $3,400 at the time of writing, trading at $3,397.

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