CPI higher than expected, rate cut in June unlikely, stocks and bonds fall, but cryptocurrencies rise against the trend

Yesterday, the United States announced that the Consumer Price Index (CPI) exceeded expectations, shattering the market's hope for a rate cut by the Federal Reserve in June. U.S. stocks closed lower across the board, with bonds experiencing a major drop. However, cryptocurrency, after a brief decline, rebounded strongly, with Bitcoin once again surpassing the $70,000 mark, BNB returning to $600, and TON seeing a weekly increase of over 50%.

Inflation Higher Than Expected, Rate Cut in June Unlikely

Due to the continuous rise in gasoline and housing costs, the U.S. Consumer Price Index (CPI) for March saw a year-on-year increase of 3.5%, exceeding expectations for the third consecutive month. The core CPI, which excludes food and energy prices, also rose by 3.8% year-on-year, surpassing the market estimate of 3.7%.

With persistent high inflation and Federal Reserve officials maintaining a hawkish stance, investors' expectations for a rate cut cycle that was anticipated to begin in June have been shattered. According to the CME FedWatch Index, the market's expectation for a rate cut has been pushed back to September, and the potential rate cut by the end of the year has been reduced to 2 digits.

Stocks and Bonds Decline, Cryptocurrency Shows Strength Against the Trend

Yesterday, U.S. stocks closed lower across the board, with the S&P 500 index falling by 0.95%, and the Russell 2000 index representing small-cap stocks dropping by 2.5%. The yield on the U.S. 10-year Treasury note closed at 4.559% on Wednesday, marking the highest closing level since November last year. The U.S. dollar strengthened overall, while the USD/JPY pair fell to a 34-year low of 153.24.

After a brief dip to 67,518 following yesterday's data release, Bitcoin gradually rose and once again returned above the $70,000 mark.

Most of the top ten cryptocurrencies by market capitalization experienced an uptrend yesterday, with BNB surging by another six hundred and a 5% increase in the past 24 hours. TON is set to introduce palmprint identification and launch a blockchain phone, as its coin price continues to hit historic highs, with a weekly increase of over 50%.

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