US PCE Inflation Rises to 2.4%, Crypto Market Braces for Impact
The post US PCE Inflation Rises to 2.4%, Crypto Market Braces for Impact appeared on BitcoinEthereumNews.com.
US economic data for November 2024 showed steady growth in key metrics, with the PCE inflation index increased by 0.1% month-over-month and 2.4% year-over-year. Excluding food and energy, the core PCE index rose by 0.1% monthly and 2.8% annually. According to the Bureau of Economic Analysis, personal income rose 0.5%, DPI increased 0.3%, and PCE climbed 0.4%. Real disposable income and spending also had moderate gains, while the inflation indicators-the PCE price index, for instance-remained subdued at 0.1% month-over-month. US Core PCE Inflation Cools: Less Volatility for Crypto? Personal consumption expenditures in the United States rose 0.4% or $81.3 billion in November, the nation‘s Bureau of Economic Analysis (BEA) reported Friday. The PCE inflation rose 0.1% month-over-month and 2.4% year-over-year. The figure increased 0.1% on a monthly basis and 2.8% on an annual one when excluding food and energy. Personal income increased 0.5 percent or $71.1 billion in the month compared to the prior month. Meanwhile, DPI increased 0.3 percent or $61.1 billion. The Core PCE was a key gauge of inflation, and below expectations, adding to expectations of continued dovish monetary policy. It saw a bullish reaction in the cryptocurrency market following this development as Bitcoin saw a sharp rally. Ahead of the indicator, Bitcoin price had slipped to the $93,000 level. However, right after the announcement, it jumped at incredible speed to $95,000, reflecting renewed investor confidence. The 0.4% rise in PCE inflation highlights resilient consumer spending in categories like autos, goods, and recreation. The modest increase in the PCE price index suggests low inflation, supporting the Federal Reserve’s current policy stance. This stable macroeconomic environment may reduce volatility for cryptocurrencies by minimizing surprises in inflation or income growth. Subdued Core PCE inflation could further support Bitcoin and altcoins by fostering a favorable macroeconomic outlook. Lower inflation decreases the likelihood of aggressive Federal Reserve rate hikes, which often weigh on risk assets like cryptocurrencies. Bitcoin’s sharp rally reflects renewed…