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The market is on track to chart a new growth course following the release of the United States Producer Price Index (PPI) for May. This data has a major effect on the broader traditional market as well as Bitcoin and the crypto ecosystem.
Bitcoin reaction to U.S. PPI data
The PPI reading is one of the major economic data points used to measure the impact of inflation on the world’s largest capital market. Per the released data, the month-on-month reading for the PPI comes in at -0.2%, as against the previous reading of 0.5%.
Alex DovbnyaThis better-than-the-expected-0.1% value implies that Federal Reserve monetary policies, as concerns keeping inflation steady, have been working overall. The upside might be felt with a recovery in risk-on assets like Bitcoin.
At the time of writing, the digital currency has maintained its bearish drawdown, down by 3.76% in the past 24 hours to $67,351. This is a major derailment from the mildly bullish momentum from earlier in the week, when the coin made emphatic moves to surpass the $70,000 price level.
Per the current outlook, the digital currency might be reacting to the news negatively, as a stronger PPI means a resilient economy, which gives corporate investors extra incentive to choose traditional assets over the risk asset.
Bitcoin ETF catalyst
While the current sentiment from the U.S. PPI data might not be favorable for Bitcoin, the impact of spot ETF trading might change the narrative overall.
With spot Bitcoin ETFs actively trading in the United States, the United Kingdom, Canada and recently Hong Kong and Australia, there are enough avenues to buy the coin and drive the price up in the long term.
Despite the drawdown, more than 513 million Bitcoin, or $34,291,565,528, has been traded in 24 hours atop a 17% jump. This is an indication of a bullish twist that might contribute to the BTC revival hurdle.
Tomiwabold Olajide
Dan Burgin
Vladislav Sopov