Australian inflation hits 21-year high as cryptocurrency markets eclipse $1 trillion
Categories: Crypto News US
Australian inflation hits 21-year high as cryptocurrency markets eclipse $1 trillion
Exactly a year ago, some raised alarm bells as the CPI rose to 3.8 per cent. At the time, academics gave many reasons not to worry, and this view was supported by the Reserve Bank of Australia (RBA), which expected inflation to hit 1.5 percent in 2022.
As it turns out, the guesses were all wrong. Of course, the CPI metric itself is not controversial, as almost everyone has a different rate of inflation based on income level, consumption habits, location, and so on. Furthermore, when the way inflation is calculated changes, as is often the case, it almost never results in an increase in the CPI, only a decrease.
The cynics would call that political expediency. Given the current inflationary pressures, the RBA is expected to hike interest rates once again next week, with analysts pointing to 0.5 per cent and 0.75 per cent as the most likely hikes.
Crypto market rises
Across the pond, the overall crypto market grew from approximately US$970 million to US$1.05 trillion at the time of writing, shortly after the federal funds rate hike by the US Federal Reserve. BTC and ETH both posted strong overnight gains of 9 and 12% respectively, amid growing signs that the broader crypto market may be involved to some extent.
Nonetheless, the broader macro environment remains uncertain and highly volatile. However, in the short to medium term, it remains to be seen whether this latest relief rally is an indicator of a change in market sentiment or just a temporary respite from the bite of the crypto winter.