Some assets remain calm, others shift direction on a single headline. This week’s numbers could push the expected rate path further out than many anticipate.

Why Crypto Still Feels Cautious

Why can’t cryptocurrencies gain upside momentum? The answer isn’t found only in charts or whale activity. This week’s incoming data wave is reshaping macro expectations and once again putting the long-discussed rally narrative to the test. Even a small deviation in the PCE print could shelve the rate-cut timeline. That’s why understanding why markets may be forced to accept a “higher for longer” scenario is becoming increasingly critical.

Banks See Sticky Inflation

Major banks still don’t see a comforting picture in core PCE. Goldman Sachs points to core PCE tracking near 3% year over year — a level that keeps distance from the Fed’s 2% target.

Bank of America echoes that view, flagging near-term inflation stickiness. The shared takeaway is clear: without convincing cooling, policymakers are unlikely to move quickly. That keeps the risk of delayed rate cuts firmly on the table.

Why Rate-Cut Hopes Are Slipping

It’s not just inflation making markets uneasy — the legal front is tense as well. A true data deluge lies ahead. The PCE price index and Fed minutes will offer clues on disinflation momentum, while the Supreme Court of the United States is expected to deliver a key ruling tied to Trump-era tariffs.

That case adds another layer of uncertainty to trade policy. If the Court narrows presidential authority, pressure on import costs could ease over time — though any inflation impact would likely take longer to surface.

The Number Markets Are Stuck On

Persistently elevated core PCE reinforces the “higher for longer” narrative. Financial conditions have become increasingly sensitive to every incremental data point. On the trade side, the future of tariffs remains pivotal, especially for sectors already operating under cost pressure.

Some economists push back on claims that rolling back emergency tariffs would trigger economic disaster. Instead, many argue that businesses are already grappling with high input costs — and that uncertainty itself has become a separate burden.

With the macro calendar packed, crypto markets remain fragile. At the time of writing, Bitcoin was fluctuating around the $69,000 level, with volatility staying elevated. Risk sentiment from traditional markets continues to spill directly into digital assets.

If rate-cut expectations slide further, pressure on risk assets could intensify in the short term. That’s why investors are watching Fed minutes and PCE not just for bonds and equities — but for crypto direction as well.

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Market participants are reassessing rate cut expectations following the announcement. Meanwhile, cryptocurrencies, gold, and stocks are being priced according to these developments. The annual CPI came in slightly above expectations at 2.7%. The monthly CPI matched expectations at 0.3%. Core CPI data showed a yearly rate of 2.9%, below expectations, and a monthly rate of 0.2%, slightly below forecasts.

June 2025 US CPI Figures 

• Consumer Price Index (CPI) Yearly: Released at 2.7% (Expectation: 2.6%, Previous: 2.4%)
• Consumer Price Index (CPI) Monthly: Released at 0.3% (Expectation: 0.3%, Previous: 0.1%)
• Core Consumer Price Index (CPI) Yearly: Released at 2.9% (Expectation: 3.0%, Previous: 2.8%)
• Core Consumer Price Index (CPI) Monthly: Released at 0.2% (Expectation: 0.3%, Previous: 0.1%)

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Core Inflation and Fed Interest Rate Expectations  

Federal Reserve officials and market participants are closely monitoring the impact of this inflation increase on interest rate policies. Members of the Federal Open Market Committee (FOMC) have previously indicated that they may delay rate cuts if inflation remains higher than expected. For instance, Fed Chair Jerome Powell recently stated, “Controlling inflation remains our priority.”  

Following May’s data, the likelihood of a rate cut in June has significantly diminished. According to the Kalshi prediction platform, rate cut expectations have dropped sharply. This shift has affected investors’ risk appetite, causing new volatility in financial assets.  

Liquidity and Inflation Reaction in Crypto Markets  

Global liquidity growth has fueled gains in cryptocurrency markets. Experts note that Bitcoin rose 4% to $110,000, moving in sync with the increase in M2 money supply. Other cryptos like Ethereum and Solana also saw similar gains. Analysts highlight that Bitcoin tends to follow changes in M2 money supply within a 71-day cycle.  

Investors eagerly await the June 11 CPI report. This data will reveal whether inflation is persistent and what path the Fed will take. Markets expect interest rates to remain around 425-450 basis points. However, inflation continues to rise. In this environment, the Fed prefers to wait before cutting rates. Federal Reserve officials, especially Chair Jerome Powell and St. Louis Fed President Alberto Musalem, have indicated they would not consider rate cuts if inflation becomes persistent.  

Traditional assets such as bonds and stocks could remain pressured due to inflation. Meanwhile, cryptocurrencies continue to benefit from increased global liquidity, deepening the divergence between markets.  

In summary, today’s US CPI report will be the most critical data guiding the markets.  

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