CPI report: Market reactions diverge as crypto sustain a slight dip

• The CPI report showed that inflation rose by 0.2%.
• The stock market and precious metals saw a rise while crypto dipped slightly.

According to recent data, the CPI report for June stayed within the anticipated outcomes. However, its impact on the crypto market, stock, and precious metal markets varied significantly. Nevertheless, regardless of the diverse reactions observed, the report generated substantial attention and discussion leading to its publication.

CPI falls within the expected range

On 12 July, the US Bureau of Labor and Statistics released the much-anticipated CPI report for June. This report holds great significance for investors involved in traditional stocks and cryptocurrencies, providing crucial insights into inflation and consumer behavior. 

During June, inflation reached its lowest annual rate in over two years, mainly due to a combination of slower price growth and more favorable comparisons against a period when inflation rates were at their highest in four decades. The consumer price index, a key metric for measuring inflation, recorded a 3% increase compared to the previous year, marking the lowest level since March 2021. Furthermore, on a monthly basis, the index experienced a modest rise of 0.2%, encompassing various prices for various goods and services.

CPI-triggered (in)actions

The release of the CPI report triggered a notable surge in social volume, as reported by Santiment. According to their data, discussions surrounding the report proliferated across various social media platforms, with Reddit and Twitter experiencing a significant upsurge in mentions on 12 July. 

? Inflation in the US rose just 0.2% in June, great news for owners of #equities, #gold, & #silver. Somewhat surprisingly, #crypto hasn’t been impacted by the #CPI report yet. Regardless, social volume related to this topic has spiked on crypto platforms. https://t.co/HrcFd1MEe0 pic.twitter.com/OyIrajCDPO

— Santiment (@santimentfeed) July 12, 2023

Additionally, Santiment’s post suggested that the prices of precious metals, including Gold and Silver, benefited from the report, displaying a positive impact. Similarly, data from Trading View indicated that the report positively influenced stocks. As of this writing, the Nasdaq 100 had surged by over 1%, while the S&P 500 had also risen by more than 0.7%.

However, the crypto market cap appeared unaffected, as it failed to exhibit any substantial response to the report.

The crypto market sees a slight dip

Contrary to other markets, the crypto market exhibited a slight downward movement following the report’s release. According to Coin Market Cap, the market cap experienced a decrease of nearly 1% at the time of writing. Nevertheless, despite this decline, the market managed to sustain its valuation within the range of over $1 trillion.

Interestingly, despite the minor dip, the 24-hour trading volume showcased a positive trend. As of this writing, the volume surpassed $30 billion, reflecting an increase of over 16% compared to previous levels.