The cryptocurrency market is experiencing a surge with Bitcoin breaking the $100,000 barrier. This milestone raises the prospect of Bitcoin going mainstream.
US inflation data will show how much pressure there is on the Federal Reserve to adjust rates. Central banks in Europe, Australia, and Brazil will also meet this week.
The European Central Bank (ECB) is expected to deliver its fourth quarter-point rate cut on Thursday, but a pick-up in inflation means a bigger rate cut is unlikely. ECB chief Christine Lagarde will likely stress caution and data-dependency.
Australia’s central bank meets on Tuesday, with the economy sputtering and the currency at four-month lows. The chances of a quarter-point reduction are below 15%. In contrast, the Bank of Canada is expected to answer investors’ wishes for more cuts.
Markets will be watching US inflation reading on Wednesday, which could affect Federal Reserve policy in the months ahead. Economists expect consumer prices to have risen 0.2% in November.
Bitcoin’s record surge past $100,000 has been attributed to Trump’s election promises and confirmation of Paul Atkins as SEC chief. However, experts warn that the token is flashing overbought on various charts.
Brazil’s central bank holds its final meeting under Governor Roberto Campos Neto on Wednesday, with bets on a sharper 75 bps hike. The government’s fiscal package has disappointed markets, driving up risk premiums on major assets.
Source: https://www.reuters.com/business/take-five/global-markets-themes-graphic-2024-12-06