Veteran Analyst Reveals the Reason for the Recent Decline and How Long He Expects It to Last

In a recent statement, famous cryptocurrency analyst Michaël van de Poppe discussed the ongoing decline in the cryptocurrency market and the reasons behind it.

Bitcoin’s price action has been described as “terrible” and has caused altcoins to suffer significantly. Van de Poppe attributed this situation to several macroeconomic events that took place last week.

Consumer Price Index (CPI) data announced last Wednesday primarily affects the FED’s decision on interest rates and whether a possible interest rate cut is on the horizon. According to the analyst, the fact that the data was lower than expected supported risky assets:

“Normal CPI was 3.3%, while 3.4% was expected. Core CPI Normal was 3.4%, while 3.5% was expected. Monthly data was also positive as 0.0% against 0.1% and 0.2% against 0.3%. “All of these are positive for a potential rate cut, or at least support future positivity for a potential rate cut.”

Producer Price Index (PPI) data, which is technically inflation data from the producer’s perspective, was also announced last week. Normal PPI gave a result of 2.2% instead of the expectation of 2.5%. Core PPI Annual was 2.3% instead of the expectation of 2.4%. According to the analyst, monthly data was also quite positive for risky assets, as it was -0.2% against 0.1% and 0.0% against 0.3%.

According to Van de Poppe, Jerome Powell’s speech on Wednesday evening was the most hawkish he has given in a significant while. According to Poppe, oddly enough all the data is pushing for an interest rate cut, as the CPI and PPI are starting to come in much lower than expected and the economic data is slowly but surely getting worse.

Van de Poppe continued his thoughts as follows:

“This points to a potential recession coming, and on top of that, the US government’s debt is starting to rise, so the amount of debt payments they have to make is getting worse and worse. “An interest rate reduction is essential in the coming period, especially during election years.”

*This is not investment advice.