Crypto experiences sharp downfall triggered by fake CPI data release


  • The fake news claims that CPI data for June 2022 increased to 10.2 percent.
  • The report claims to be a leaked version of the original data, which will be released on Wednesday, July 13.

Prices of BTC, ETH, and other altcoins suffered sharp declines on Tuesday following a news release that claims to be the consumer price index (CPI) data for last month. According to this fake news, CPI surged by 1.7 percent and is currently at 10.2 percent. However, the report claims to be a leaked version of the one to be released on July 13.

The US Bureau of Labor Statistics (BLS) has scheduled 8.30 am EST on July 13 as the date and time it would release the actual CPI data. The CPI data reflects the monthly changes to prices paid by US consumers. The data is usually a strong determinant of inflation levels. There is a direct relationship between inflation rates and CPI data. A rise in CPI data means a surge in inflation rates.

The BLS has tweeted that the report is fake and has no correlation with the real one. The BLS added that it would release the real one as previously announced. Crypto prices react to fake CPI data release. The fake CPI report spread like wildfire on various social platforms, causing a sharp decline in crypto prices.

BTC dropped to $19,302 but has since recovered to trade at $19,844, according to Coinmarketcap data. ETH dropped by 7 percent in value, but it has also recovered slightly and now trades at $1,076. Other digital assets suffered the same fate. The CPI data has enormous significance. The monetary policies of the US Fed largely depend on the monthly CPI data.

If the CPI data indicates rising inflation levels, the fed responds by increasing interest rates. Last time, the fed raised rates by 0.75 percent due to high inflation levels. The rising interest rates caused a huge fall in crypto prices. Also, bitcoin experienced its biggest quarterly decline in more than ten years following that rate increase.

Crypto investors more cautious until the CPI data release

Most crypto investors and traders are waiting for the CPI data release before making any investment moves. Famous crypto advocate and trader, Lark Davis, believes that macros control cryptos. Hence, they can ruin the crypto market.

Nevertheless, Jean-Pierre, a spokesperson for the White House, believes there will be an increase in June 2022 CPI data. Meanwhile, arcane research analyst, Vetle Lunde, said there had been a lot of shorts as investors are waiting for today’s CPI data release.

He added that BetaPro Inverse Bitcoin ETF (BITI) experienced its 2nd biggest daily net inflow yesterday. However, analysts predict that consumer inflation may have reached its peak due to the drop in oil and gasoline prices this month.

Dow Jones expects a 1.1 percent rise in CPI data for June, which will be a 0.1 percent rise compared to May. The year-on-year data shows an 8.8 percent rise in CPI compared to 8.6 percent in May. That would be the biggest CPI rise in 41 years.

 





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The fake news claims that CPI data for June 2022 increased to 10.2 percent. The report claims to be a leaked version of the original data, which will be released on Wednesday, July 13. Prices of BTC, ETH, and other altcoins suffered sharp declines on Tuesday following a news release that claims to be the…