
May CPI Rises to 2.5%, Markets Unshaken: Inflation edges higher, but Bitcoin, stocks, and altcoins remain stable amid Fed rate pause bets.
Fed Likely to Hold Rates; All Eyes on June Events: Traders watch upcoming FOMC, PPI, and trade data for clues on future monetary policy.
The U.S. Bureau of Labor Statistics has released the latest Consumer Price Index (CPI) data for May. The report shows inflation rising to 2.5% year-over-year, in line with forecasts. Despite this slight uptick, Bitcoin, stocks, and altcoins held their ground, showing no big moves.
Letโs take a closer look at what this means for traders and the economy.
CPI and Core CPI Numbers Confirmed
The May Consumer Price Index (CPI) report revealed that inflation rose slightly compared to April, raising new concerns about the pace of economic cooling in the U.S.
Meanwhile, the year-over-year (YoY) headline CPI increased to 2.5% in May, up from 2.3% in April.
Similarly, Core CPI YoY, which excludes food and energy prices, ticked up to 2.9%, compared to 2.8% in the previous month. On a month-over-month (MoM) basis, the headline CPI held steady at 0.2%, while Core CPI MoM rose to 0.3%, up from 0.2% in April.
These small changes might not seem like much, but they could have a big impact on where the markets go.
What the Fed Will Do Next?
With inflation staying moderate, the Federal Reserve is likely to keep interest rates unchanged at its June 12 meeting. According to the CME FedWatch Tool, the chance of a rate cut in July is now low, pushing expectations further into late 2025.
Interestingly, prediction markets like Polymarket suggest thereโs a 75% chance that the Fed might cut rates in 2025.
Next Key Events To Watch out for?
June 18 โ FOMC Meeting:
The Fed will decide on interest rates. Even if they hold rates steady, markets will listen closely to Fed Chair Powellโs words and the dot plot for clues about future cuts.
Even if rates stay the same, Powellโs remarks will carry heavy weight.
June 12 โ U.S. PPI Report:
Producer prices give early signals of future consumer inflation. A cooler print might boost optimism for rate cuts.
June 17 โ U.S. Import and Export Price Indexes
On June 17, the US will release the Import and Export Price Indexes, which track international trade prices. In April, import prices rose slightly by 0.1%.
Impact on the Crypto Market
If the Federal Reserve stays cautious and maintains a hawkish stance, Bitcoin could face short-term pressure. Currently, Bitcoin is trading around $109,739, showing a slight increase over the last 24 hours.
Interestingly, altcoins like Ethereum, Solana, and XRP are also seeing a bullish surge, with all of them trading in the green today.
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FAQs
The May 2025 CPI rose to 2.5% year-over-year, up from 2.3% in April, showing a slight increase in inflation as expected.
Bitcoin remained stable around $109,739 after the CPI release, showing no major reaction to the inflation uptick.
Watch for the June 12 PPI report, June 17 trade price indexes, and the June 18 FOMC meeting for market-moving updates.