empty
15.07.2025 09:58 AM
Rising Inflation in the U.S. Will Decrease the Likelihood of Fed Rate Cuts (Possible Resumption of USD/CAD and Bitcoin Growth)

While President Donald Trump continues playing his favorite game called "Make America Great Again," market participants are calculating the cost of U.S. trade wars with nearly the entire world, for both themselves and the global economy.

Today, market focus will be on the release of key U.S. consumer inflation data, which is expected to show increases in both monthly and yearly terms, in both headline and core figures.

According to the consensus forecast, year-over-year inflation is expected to rise to 2.6% from 2.4%, with core inflation also climbing to 3.0% from 2.8%. On a monthly basis, both headline and core CPI are projected to increase by 0.3% in June, compared to 0.1% in May.

What do these figures suggest?

They point to the fact that the erratic, back-and-forth policy course demonstrated by the 47th president is leading nowhere good. As decades-long trade relationships are dismantled, transaction costs are rising, along with prices for final goods imported into the U.S. Moreover, it remains unclear who will manufacture all the necessary products domestically, given the lack of a robust industrial base for producing a wide range of goods like clothing and footwear. Executives of major U.S. corporations have already said they are unable to manufacture domestically the products currently made abroad for them. Therefore, Trump's aggressive tactics against trade partners are unlikely to yield meaningful results. Yes, some countries unable to resist U.S. pressure might give in—but ultimately, the harsh trading conditions will force them to seek alternative markets.

Under such circumstances, inflation has room for sustainable growth. This would prevent the Federal Reserve—at least while it is still led by Jerome Powell—from resuming interest rate cuts, something Trump has been eagerly pushing for. In this context, the U.S. dollar may continue to rise gradually on the Forex market, supported by the increasingly unlikely prospect of rate cuts this year. The situation could change only if the president manages to replace the Fed Chair with someone more compliant, willing to ignore the decades-old 2% inflation target. But if that happens, the U.S. could return to much higher inflation levels, similar to those seen in the 1980s.

What can be expected in the markets?

If the consumer inflation report comes in line with or above expectations, it will likely support the dollar on the Forex market, as it would delay the likelihood of Fed rate cuts until later in the year, possibly the end of the year, rather than this fall, as previously expected.

This development could put noticeable pressure on demand for cryptocurrencies traded against the dollar, and have a short-term negative effect on demand for company stocks. In such a scenario, the price of gold may continue climbing toward its local high, despite a stronger dollar.

However, if the report unexpectedly shows a drop in inflationary pressure, the opposite market reaction can be expected.

This image is no longer relevant

This image is no longer relevant

Forecast of the Day:

USD/CAD

The pair is trading below the resistance level of 1.3700. A breakout of this level—driven by continued dollar strength due to Trump's tariff policies toward Canada—could push the pair toward 1.3800. A potential buy entry level is around 1.3711.

Bitcoin

The token is under strong pressure amid expectations of rising U.S. inflation and, consequently, a stronger dollar. Against this backdrop, Bitcoin could fall to 110,648.00 after breaking the support level at 116,765.00. A potential sell entry level is around 116,370.99.

Summary
Urgency
Analytic
Viktor Vasilevsky
Start trade
Gana con los cambios en el valor de las criptomonedas con InstaForex.
Descarga MetaTrader 4 y abre tu primera operación.
  • Grand Choice
    Contest by
    InstaForex
    InstaForex always strives to help you
    fulfill your biggest dreams.
    UNIRSE AL CONCURSO

Recommended Stories

Análisis del par GBP/USD. El 13 de agosto. A la espera del viernes...

El par de divisas GBP/USD volvió a negociarse de forma bastante apática el martes. Por la mañana, en el Reino Unido se publicaron datos sobre desempleo y salarios, pero resultaron

Paolo Greco 07:38 2025-08-13 UTC+2

Análisis del par EUR/USD. El 13 de agosto. Trump y China llegaron a un acuerdo. Otra vez temporalmente.

El par de divisas EUR/USD volvió a negociarse de forma bastante tranquila. Por un lado, el par no se queda inmóvil, pero al mismo tiempo la volatilidad es baja

Paolo Greco 07:38 2025-08-13 UTC+2

Análisis del par GBP/USD. El 12 de agosto. Una inflación que ya no decide nada.

El par de divisas GBP/USD el lunes se movió de forma muy débil. Como ya dijimos, el trasfondo fundamental sigue siendo fuerte y resonante, pero los traders parecen haberse tomado

Paolo Greco 06:45 2025-08-12 UTC+2

Análisis del par EUR/USD. El 12 de agosto. Nunca había pasado, y ahora otra vez.

El par de divisas EUR/USD el lunes continuó negociándose de forma súper tranquila. El trasfondo macroeconómico estuvo ausente por segundo día de negociación consecutivo, y el trasfondo fundamental el mercado

Paolo Greco 06:45 2025-08-12 UTC+2

Análisis del par GBP/USD. Vista previa de la semana. Un paquete de estadísticas británicas que la libra no necesita.

El par de divisas GBP/USD continúa un sólido movimiento alcista después de una corrección de un mes. Para la corrección había fundamentos técnicos (el precio no puede moverse siempre

Paolo Greco 04:31 2025-08-11 UTC+2

Análisis del par EUR/USD. Vista previa de la semana. Al dólar le esperan nuevas pruebas.

El par de divisas EUR/USD muestra todos los signos de reanudación de la tendencia alcista, que debería llevar el nombre de Trump. La caída de la moneda estadounidense comenzó prácticamente

Paolo Greco 04:31 2025-08-11 UTC+2

WTI - West Texas Intermediate. Análisis de precios. Pronóstico. Trump amenaza a India y China con aranceles adicionales sobre la importación de petróleo ruso, lo que genera preocupaciones sobre la redirección de los suministros.

El petróleo West Texas Intermediate (WTI), que es el referente del crudo estadounidense, rebotó desde un mínimo de cinco semanas y subió por encima de los $63,50 en medio

Irina Yanina 04:25 2025-08-07 UTC+2

Análisis del par GBP/USD. El 7 de agosto. ¿Qué nos tiene preparado el Banco de Inglaterra?

El par de divisas GBP/USD el miércoles volvió a negociarse con bastante calma, pero la balanza poco a poco se inclina a favor de la libra (y también del euro)

Paolo Greco 04:25 2025-08-07 UTC+2

Análisis del par EUR/USD. El 7 de agosto. Trump inicia una nueva ronda de escalada en la guerra comercial.

El par de divisas EUR/USD durante la mayor parte del miércoles volvió a negociarse con una volatilidad muy baja. Esta semana hay realmente muy pocos eventos macroeconómicos, pero al mismo

Paolo Greco 04:25 2025-08-07 UTC+2

Análisis del par GBP/USD. El 6 de agosto. La libra espera el veredicto del Banco de Inglaterra.

El par de divisas GBP/USD se mantuvo prácticamente sin cambios durante la mayor parte del martes. En principio, no hay nada sorprendente en esto, ya que al menos

Paolo Greco 04:23 2025-08-06 UTC+2
¿No puede hablar ahora mismo?
Ingrese su pregunta en el chat.
Widget callback
 

Dear visitor,

Your IP address shows that you are currently located in the USA. If you are a resident of the United States, you are prohibited from using the services of InstaFintech Group including online trading, online transfers, deposit/withdrawal of funds, etc.

If you think you are seeing this message by mistake and your location is not the US, kindly proceed to the website. Otherwise, you must leave the website in order to comply with government restrictions.

Why does your IP address show your location as the USA?

  • - you are using a VPN provided by a hosting company based in the United States;
  • - your IP does not have proper WHOIS records;
  • - an error occurred in the WHOIS geolocation database.

Please confirm whether you are a US resident or not by clicking the relevant button below. If you choose the wrong option, being a US resident, you will not be able to open an account with InstaForex anyway.

We are sorry for any inconvenience caused by this message.