The upcoming U.S. retail sales report is crucial for market participants, as it may suggest a -0.6% to -0.7% drop, contrasting April’s 0.1% rise. Analysts and professionals usually focus on these reports to identify shifts in consumer behavior.
Konstantinos Chrysikos from Kudotrade emphasizes the potential implications, suggesting further rate cuts by the Federal Reserve as a possible outcome. Market participants expect two rate reductions this year.
U.S. Sales Data and Anticipated Fed Rate Cuts
Changes in market predictions are based on anticipated drops in retail sales. If the sales data surpasses the forecasted decline, it could boost expectations for additional Fed cuts in 2025. Such changes typically influence the dynamics of interest rates and liquidity, potentially benefiting asset categories like Bitcoin and Ethereum.
Market reactions remain swift, with retail and crypto industries closely watching for signs of economic shifts. The National Retail Federation’s Matthew Shay conveyed that while consumers aren’t yet significantly impacted, there’s ongoing unpredictability. Matthew Shay, President and CEO, National Retail Federation, said, “The data for May indicates that the pull-forward in consumer demand ahead of tariffs is likely dissipating…Consumer fundamentals haven’t been damaged yet, and a slowing-but-still-growing job market is supporting household priorities ahead of any meaningful price increases in the coming months.”
Analysis by Coincu highlights the potential for rate cuts to influence regulatory and financial trends. Lower rates may lead to increased investment in riskier assets, potentially driving cryptocurrency adoption as traditional returns diminish. Technological advancements are expected as risk sentiment improves during looser monetary policies.
Crypto Market Positively Correlated with Lower Fed Rates
Did you know? A rate cut can positively affect crypto values, as seen during previous monetary easing phases. This is due to reduced opportunity costs for holding non-yielding assets like Bitcoin.
Bitcoin (BTC) is currently valued at $105,801.11, with a market cap of $2.10 trillion, as per CoinMarketCap data. Over the past 90 days, BTC’s price has increased by 26.29%. The 24-hour trading volume shows a 22.62% change from its prior status. BTC maintains strong market dominance at 63.95%.
Technological advancements are expected as risk sentiment improves during looser monetary policies.
