Tuesday’s CPI data turned out to be a mixed bag, with a better-than-expected headline print and a worse-than-expected core CPI.
However, the latest inflation data has provided just enough wiggle room for the Federal Reserve to cut its target rate at the September FOMC, especially considering disastrous July jobs report.
Interest rate traders have increased bets on a 25 basis point cut in September, with the CME FedWatch Tool now pricing in a 95% probability.
The cool headline CPI has given a green light to the crypto market to continue its bull run, with the Ethereum price surging past the $4600 price mark. According to CoinMarketCap data, ETH is now just under 6% away from a new all-time high.
Meanwhile, Pump.fun, JasmyCoin and Fartcoin are the two three crypto gainers on Tuesday, up by nearly 20%, 14% and 12%, respectively.
What Tuesday’s CPI Data Means For Crypto Prices?
Tuesday’s CPI release was broadly in line with market expectations. Headline inflation rose 2.7% year-on-year, a touch below the 2.8% forecast. Core CPI, which strips out volatile food and energy components, climbed 3.1% annually, slightly above the 3.0% consensus.
On a seasonally adjusted basis, headline CPI rose 0.2% month-on-month, while core CPI advanced 0.3% in July, in line with the market forecasts.
The inflation levels in the US economy remain a concern, with the trend currently heading in the wrong direction. Meanwhile, the rapidly cooling shelter prices aren’t enough to make up for the surge in goods and services, resulting in a continued increase in the core CPI.
However, the weakness in the labour market is now the biggest risk associated with the US economy after a brutal July jobs report.
As a result, Tuesday’s CPI print showed nothing that would prevent a Fed rate cut in the September FOMC. The CME FedWatch is showing nearly 95% probability of a 25 bps cut in September. Moreover, 3 rate cuts this year has now become the odds-on scenario, a bullish scenario for risk assets like crypto.
Unsurprisingly, crypto prices are already soaring.
Ethereum Price Hits $4600, New All-Time High This Week?
Ethereum continues to show considerable bullish strength, buoyed by the soft CPI print as well as aggressive buying from ETH treasury firms. Tom Lee’s BitMine has announced plans to sell up to $20 billion in common stock to boost its Ethereum holdings.
Ethereum hit the $4600 price mark in the post-CPI pump and is now just under 6% away from a new all-time high, which could happen this week itself.
Meanwhile, Solana coins are showing bullish strength as well. Pump.fun (PUMP) is back above its presale trading price of $0.004 and is the top crypto gainer on Tuesday, up nearly 20% over the past 24 hours.
Similarly, the Fartcoin price is up by 12%, trading just above the $1 mark at press time. It is currently the best-performing meme coin among the large caps.
JasmyCoin, Chainlink, Aerodrome Finance and Solana are also among the top performers in the post-CPI crypto bull rally.
Best Low-Cap Cryptos To Buy Now
Following the soft CPI print, crypto prices are pumping hard and the bull market euphoria is returning. This is the perfect backdrop for low-cap cryptos to skyrocket as whales and smart money investors hunt for big money-making opportunities.
For instance, a whale swapped 35 ETH to invest over $160k in Bitcoin Hyper (HYPER), the latest entrant in the layer-2 ecosystem.
The HYPER presale has nearly hit the $9 million milestone in short order as whales are starting to FOMO buy.
Bitcoin Hyper is based on the powerful Solana Virtual Machine and zero knowledge architecture and aims to bring programmability, scalability and performance to the Bitcoin ecosystem. It could soon be the hub for payment products, DeFi platforms and even meme coins on the BTC blockchain.
Such top layer-2 coins tend to hit multibillion-dollar valuations, which indicates high upside for a low-cap coin like HYPER. Many smart money investors are eyeing up to 100x returns from it.
The same whale invested $100k into TOKEN6900, the new ETH-based alternative of the popular Solana meme coin, SPX6900.
T6900 has raised nearly $2 million in its viral ICO, which has a hard cap of just $5 million.
Much like SPX6900, Fartcoin and Useless Coin, TOKEN6900 is all about the internet culture, memes and community support. There is no deceptive push for any utility or AI.
T6900 has emerged as an attractive meme coin, with several seasoned traders among the early buyers. Many among them have called it the next 1000x crypto.
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