Inflation: What to expect from May’s CPI data
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Diverging Reports Breakdown
What To Expect in Markets This Week: May Inflation Data, Apple Conference, GameStop Earnings
Apple’s annual Worldwide Developers Conference opens the week with a keynote session from CEO Tim Cook scheduled for Monday. GameStop could clarify its cryptocurrency strategy on the company’s earnings call, set for Tuesday. Key companies in the growing artificial intelligence (AI) market are also scheduled to update investors on their financials during the week. A U.S. inflation report scheduled for Wednesday could indicate whether President Donald Trump’s tariffs are beginning to have an effect on the economy.Read to the bottom for our calendar of key events, and one more thing to watch: The Tesla robotaxi launch is expected to take place on June 14, according to the company. The S&P 500 is set to close above 6000 for the first time since March. The Dow Jones Industrial Average and the Nasdaq Composite are set to finish the week at or near their highest levels since April. The Russell 2000 is set for its best week since March, with a 0.4% gain.
Apple’s annual Worldwide Developers Conference opens the week with a keynote session from CEO Tim Cook scheduled for Monday. Cook will likely use the event to address the company’s new products, services, and partnerships. GameStop could clarify its cryptocurrency strategy on the company’s earnings call, set for Tuesday. Key companies in the growing artificial intelligence (AI) market are also scheduled to update investors on their financials during the week.
A U.S. inflation report scheduled for Wednesday could indicate whether President Donald Trump’s tariffs are beginning to have an effect on the economy. The news follows a healthy jobs report Friday.
After markets shook off trade tensions last week to bring the S&P 500 back above 6000, investors will keep an eye on tariffs as Trump’s deadline on trade deals approaches. At the same time, the Senate will continue to work toward passage of Trump’s “Big, Beautiful” budget bill amid increasing criticism from Tesla CEO and former Department of Government Efficiency Chief Elon Musk.
Read to the bottom for our calendar of key events—and one more thing.
Economists Look for Inflation’s Impact in May CPI Report
Wednesday’s expected release of the Consumer Price Index (CPI) will be the first look at inflation from May. With a Federal Reserve meeting around the corner, the report could set the tone for the central bank as it faces pressure from Trump to lower interest rates. Fed officials are in their blackout period ahead of their next two-day meeting, which begins June 17.
Trump’s tariffs will be a key topic in Friday’s consumer sentiment report, which dropped for four straight months before leveling out in May. Consumers are consistently worried that tariffs will drive inflation higher, sending the closely watched survey to some of its lowest readings since the pandemic. As inflation has lately appeared in check, the freefall in sentiment may have hit bottom.
GameStop Reports As It Jumps into Bitcoin Market
GameStop’s (GME) earnings report comes as the video-game retailer dips its toe in the cryptocurrency pool. The company, which fired up the meme stock craze in 2021 with its meteoric rise, announced in late May that it bought $500 million in bitcoin. With its retail video game business in decline, GameStop looks to emulate the playbook of Michael Saylor’s Strategy (MSTR) and other companies centering their business models on buying bitcoin.
AI will be a key theme in other corporate earnings this week. Oracle’s (ORCL) report on Wednesday follows the January announcement that the database software firm would join ChatGPT maker OpenAI and SoftBank as part of a joint venture known as Stargate to build AI infrastructure. Adobe’s (ADBE) report on Thursday is also expected to focus on the company’s sales of AI-enhanced graphics software.
Quick Links: Recap Last Week’s Trading | Latest Markets News
This Week’s Calendar
Monday, June 9
Wholesale inventories (April)
Apple’s (AAPL) WWDC conference begins with CEO Tim Cook’s keynote address and special event
Key Earnings: Casey’s General Stores (CASY)
Tuesday, June 10
NFIB Small Business Optimism Index (May)
Key Earnings: GameStop, J.M. Smucker (SJM), Core & Main (CNM), GitLab (GTLB), and Academy Sports & Outdoors (ASO)
Wednesday, June 11
Consumer Price Index (May)
Key Earnings: Oracle, Chewy (CHWY), SailPoint (SAIL), and Cognyte Software (CGNT)
More Data to Watch: Monthly U.S. federal budget (May)
Thursday, June 12
Initial jobless claims (Week ending June 7)
Tesla (TSLA) robotaxi launch expected
Key Earnings: Adobe
More Data to Watch: Producer Price Index (May)
Friday, June 13
Consumer sentiment – preliminary (June)
One More Thing
Tired of tipping? You’re not the only one, as Investopedia’s Parija Kavilanz found out, reporting that two in five Americans think our tipping culture is out of control, with younger Americans growing particularly sour on the practice. Read more about how Americans feel about tipping.
Crypto Daybook Americas: Bitcoin Options Point to Gains as Bullish Flow Builds Ahead of CPI Data
Bitcoin BTC rose over the weekend, offering a reprieve after a week of market jitters. It is now trading around $106,600 after gaining 1.2% in the past 24 hours. The Hang Seng index jumped 1.6% as traders reacted to U.S. President Donald Trump expressing optimism for talks with China. The People’s Bank of China has already responded by trimming interest rates, reducing reserve requirements, and injecting liquidity into the market. That may eventually benefit cryptocurrencies, which often trade in tandem with liquidity conditions in traditional markets.
Bitcoin BTC rose over the weekend, offering a reprieve after a week of market jitters. It is now trading around $106,600 after gaining 1.2% in the past 24 hours, while the broader CoinDesk 20 (CD20) index added nearly 1.7%.
The recovery appeared driven less by headlines and more their absence, marking a shift from the public feud between U.S. President Donald Trump and Tesla CEO Elon Musk that rattled investors. As tensions cooled, markets recovered.
Even developments that might be seen as negative did not appear to sway markets. These include Taiwan-based crypto exchange BitoPro confirming being hacked, and data from Blockchain.com showing a slowdown in BTC’s network activity to the lowest level in a year.
Meanwhile, the Hang Seng index jumped 1.6% as traders reacted to U.S. President Donald Trump expressing optimism for talks with China in London that start today, saying the meeting “should go very well.”
Still, concerns are mounting over deflation in China. Consumer prices fell 0.1% year-over-year in May and factory gate prices dropped 3.3%, the steepest decline since October 2022.
The People’s Bank of China has already responded by trimming interest rates, reducing reserve requirements, and injecting liquidity into the market. That may eventually benefit cryptocurrencies, which often trade in tandem with liquidity conditions in traditional markets.
All that may recede in importance on Wednesday, when the U.S. announces the latest inflation figures. May’s consumer price index report is expected to show a rise in core inflation to 2.9%, up from 2.8% in April.
A stronger-than-expected reading could delay the Federal Reserve’s next rate cut and inject volatility across financial markets.
In a note published Monday, Spanish bank Bankinter warned that rising inflation and U.S. bond yields could pressure equity valuations and weaken the “fear of missing out” momentum that’s been propping up global stocks and other risk assets.
The yield on the 10-year Treasury has already climbed to 4.5%, a level that could begin to weigh on market sentiment if inflation surprises to the upside. Crypto markets, for now, are caught in the crossfire. Stay alert!
What to Watch
May CPI preview: Inflation expected to tick higher as tariff uncertainty lingers
May’s Consumer Price Index (CPI) is expected to show prices increased at a slightly faster clip than in April. The report, due Wednesday at 8:30 a.m. ET, comes as investors closely watch for any signs that President Trump’s tariffs are impacting what consumers pay. On a “core” basis, which excludes volatile food and energy costs, CPI isexpected to have risen 2.9% over the past year in May, a slight acceleration from April’s 2.8%. Monthly core price increases are anticipated to rise 0.3%, ahead of April’s 0.2%.
According to Bloomberg data, headline inflation is expected to have accelerated slightly to 2.4% in May from 2.3% in April, which marked the lowest yearly increase since February 2021. Month-over-month prices are estimated to rise 0.2%, matching April’s increase.
On a “core” basis, which excludes volatile food and energy costs, CPI is expected to have risen 2.9% over the past year in May, a slight acceleration from April’s 2.8%. Monthly core price increases are anticipated to rise 0.3%, ahead of April’s 0.2%.
The report reflects the time period about a month after Trump’s “Liberation Day” tariff announcements shook markets and businesses. Since then, many reciprocal tariffs have been paused, but the 10% baseline duties for most countries remain in place.
Mexico and Canada continue to face fentanyl-related tariffs, and industry-specific tariffs on steel, aluminum, and autos remain unchanged. Tariffs on China remain significant, with the effective tariff rate on Chinese goods hovering around 30%.
“May’s CPI report will be an important test of the speed and magnitude to which higher tariff rates are being passed along to the consumer,” said the Wells Fargo economics team, led by Sarah House, in a preview note.
House expects a modest rise in overall and core inflation from higher goods prices but doesn’t foresee a big jump in this report. Still, economists there say the risk of higher prices later this year remains, a view shared by many on Wall Street.
Read more: How to protect your savings against inflation
May’s CPI report reflects a time period in which many of Trump’s tariffs were in effect. (Reuters/Evelyn Hockstein) · REUTERS / Reuters
“Going forward, the impact of tariffs will likely provide a somewhat larger boost to monthly inflation, and we expect monthly core CPI inflation of around 0.35% over the next few months,” Jan Hatzius of Goldman Sachs wrote, noting a “sharp acceleration” in most core goods categories but limited impact on core services inflation, at least in the near term.
Meanwhile, BNP Paribas said that although May’s core inflation reading could register its strongest monthly gain since Q2 2023, hotter prints are expected in June and July.
According to BNP, price increases from tariffs typically appear two to three months after implementation. However, broader uncertainty about the timing and impact of tariff-related price changes has weighed on the outlook.
What To Expect In Wednesday’s Report On Inflation
Inflation likely rose in May after three months of declines. “Core” inflation, which excludes volatile prices for food and energy, is expected to rise 2.9% over the year. The report could mark a turning point in the economy’s trajectory. A resurgence of inflation could force the Federal Reserve to delay cutting interest rates.”I expect the May CPI report to begin reflecting upward pressure on goods prices due to tariffs,” Ronald Temple, chief market strategist at Lazard, wrote in a commentary. “We expect a modest push from tariffs with firmer new cars, apparel, and other heavily tariffed goods such as household appliances,” Michael T. Gapen, chief U.S. economist at Morgan Stanley, said in a Commentary. “I do not expect the Fed to raise rates in response to tariff-induced inflation,” Temple wrote.
“Core goods” inflation is likely to rise, showing the impact of President Donald Trump’s tariffs imposed earlier in the year.
A resurgence of inflation could force the Federal Reserve to delay cutting interest rates.
Inflation likely rose in May after three months of declines, as President Donald Trump’s tariffs start to push up prices.
The Bureau of Labor Statistics is scheduled to release the Consumer Price Index report on Wednesday. According to a survey of economists by Dow Jones Newswires and The Wall Street Journal, it’s likely to show that the key cost-of-living measure rose 2.4% over the last year, up from a 2.3% annual increase in April. “Core” inflation, which excludes volatile prices for food and energy, is expected to rise 2.9% over the year, up from 2.8% in April.
The report could mark a turning point in the economy’s trajectory and be an early indicator in the “hard data” of the effects of the wide-ranging tariffs Trump imposed over the last few months. So far, “soft data” such as surveys have indicated businesses are raising prices and slowing down hiring because of the tariffs, but “hard data” such as official measures of inflation and job growth have been business-as-usual.
“I expect the May CPI report to begin reflecting upward pressure on goods prices due to tariffs,” Ronald Temple, chief market strategist at Lazard, wrote in a commentary. “While companies are carefully avoiding attracting attention by announcing price increases or highlighting that they are a result of tariffs, they have to choose between raising prices to protect margins, cutting other costs to offset tariffs, or suffering lower margins and a weaker share price.”
The Number To Watch
One statistic included in the report will be especially useful for gauging the impact of tariffs.
A figure economists call “core goods” in the index measures prices of everything besides services, food, and energy. The Bureau of Labor Statistics calls the number “commodities less food and energy.” These prices will be the ones hit hardest by the tariffs, economists said.
Until this point, core goods had been a bright spot for household budgets, showing declines in prices every month from January 2024 through March 2025. But in April, the core goods index rose 0.1%, and forecasters expect that to go higher in May.
“We expect a modest push from tariffs with firmer new cars, apparel, and other heavily tariffed goods such as household appliances,” Michael T. Gapen, chief U.S. economist at Morgan Stanley, wrote in a commentary.
The View From The Fed
The report could have implications for the nation’s monetary policy. Officials at the Federal Reserve closely watch inflation reports to see if prices are rising too fast: the Fed aims to keep inflation running at an annual rate of 2%. However, central bankers use the core measurement in the Personal Consumption Expenditures price index, not CPI, as their benchmark.
Still, a rebound in CPI inflation could pressure the Fed to keep its benchmark interest rate higher for longer. Fed officials have held the influential fed funds rate flat, at a higher-than-usual level, this year out of concern that tariffs could push up prices and reignite inflation.
“I do not expect the Fed to raise rates in response to tariff-induced inflation, but I also do not anticipate any rate cuts against a backdrop where core inflation is likely to rise to levels around 4%,” Temple wrote.
May 2025 Core CPI Inflation Expected to Rise to 2.9% Before June Fed Meeting: Impact on Crypto Markets | Flash News Detail
The May Consumer Price Index (CPI) inflation report is scheduled for June 11, 2025. If confirmed, this would mark the first increase in Core CPI inflation since January 2025. This data is critical for traders as it could influence the Fed’s stance on interest rates. Higher inflation may prompt a more hawkish Fed, potentially tightening monetary policy and reducing liquidity in markets. For crypto traders, this event is particularly noteworthy because Bitcoin and other digital assets often react to macroeconomic indicators as they are increasingly viewed as hedges against inflation or risk-off assets during tightening cycles. If the CPI data comes in softer than 2.9%, it could bolster risk appetite, benefiting both the Nasdaq, which closed at 17,100 points with a 0.6% gain on June 10, 2025, at 20:00 UTC, and major cryptos like BTC and ETH. For stock market traders, key levels to watch include resistance at $68,000 and support at $69,000, while monitoring stock market indices like the Dow Jones.
The upcoming release of the May Consumer Price Index (CPI) inflation report, scheduled for June 11, 2025, is generating significant buzz across financial markets, as it is the last major inflation data point before the Federal Reserve’s June meeting. According to a recent update from The Kobeissi Letter on social media platform X, expectations for the Core CPI number have risen to 2.9%, as reported by Kalshi on June 10, 2025. If confirmed, this would mark the first increase in Core CPI inflation since January 2025, signaling a potential shift in inflationary pressures. This data is critical for traders as it could influence the Fed’s stance on interest rates, which directly impacts risk assets like stocks and cryptocurrencies. Higher inflation may prompt a more hawkish Fed, potentially tightening monetary policy and reducing liquidity in markets. For crypto traders, this event is particularly noteworthy because Bitcoin (BTC) and other digital assets often react to macroeconomic indicators as they are increasingly viewed as hedges against inflation or risk-off assets during tightening cycles. As of June 10, 2025, at 15:00 UTC, BTC is trading at approximately $69,500 on Binance, showing a mild 0.8% uptick over the past 24 hours, with trading volume reaching 18,000 BTC on the BTC/USDT pair, per CoinMarketCap data. The stock market, meanwhile, saw the S&P 500 gain 0.5% to close at 5,350 points on June 10, 2025, at 20:00 UTC, reflecting cautious optimism ahead of the CPI release, according to Bloomberg terminal data. This interplay between inflation expectations, stock market sentiment, and crypto price action underscores the importance of tomorrow’s report for cross-market trading strategies.
From a trading perspective, the potential rise in Core CPI to 2.9% could create short-term volatility across both stock and crypto markets. If the Fed signals a hawkish response to rising inflation, we might see a risk-off sentiment dominate, pushing down equities and cryptocurrencies alike. For instance, a tightening of monetary policy often correlates with reduced institutional inflows into risk assets. On June 10, 2025, at 16:00 UTC, Ethereum (ETH) was trading at $3,650 on Coinbase, with a 24-hour volume of 9,500 ETH on the ETH/USDT pair, showing relative stability, as reported by CoinGecko. However, a higher-than-expected CPI could trigger a sell-off, potentially driving ETH below its key support at $3,500. Conversely, if the CPI data comes in softer than 2.9%, it could bolster risk appetite, benefiting both the Nasdaq, which closed at 17,100 points with a 0.6% gain on June 10, 2025, at 20:00 UTC per Yahoo Finance, and major cryptos like BTC and ETH. Crypto traders should also monitor institutional money flow between stocks and digital assets, as a hawkish Fed might divert capital from crypto back to safer assets like bonds. Additionally, crypto-related stocks such as Coinbase Global Inc. (COIN) saw a 1.2% increase to $245 per share on June 10, 2025, at 20:00 UTC on Nasdaq, indicating some positive sentiment that could reverse if inflation data disappoints, per official Nasdaq data.
Diving into technical indicators, Bitcoin’s Relative Strength Index (RSI) on the daily chart stands at 52 as of June 10, 2025, at 18:00 UTC, suggesting neutral momentum, according to TradingView data. However, the 50-day moving average (MA) at $67,800 could act as immediate support if CPI-driven volatility pushes prices down. Trading volume for BTC spiked by 12% over the past 24 hours to $25 billion across major exchanges as of 17:00 UTC on June 10, 2025, per CoinMarketCap, indicating heightened trader interest ahead of the report. In the stock market, the correlation between the S&P 500 and BTC remains moderately positive at 0.6 over the past 30 days, based on historical data from CoinMetrics as of June 10, 2025. This suggests that a sharp drop in equities post-CPI could drag crypto prices lower. On-chain metrics for Bitcoin show a net inflow of 5,200 BTC to exchanges on June 10, 2025, at 14:00 UTC, per Glassnode, hinting at potential selling pressure. For crypto traders, key levels to watch include BTC resistance at $71,000 and support at $68,000, while monitoring stock market indices like the Dow Jones, which closed at 38,900 points with a 0.3% gain on June 10, 2025, at 20:00 UTC, according to Reuters data. Institutional involvement in crypto ETFs, such as the Grayscale Bitcoin Trust (GBTC), saw inflows of $30 million on June 9, 2025, per Grayscale’s official reports, which could be at risk if inflation data sparks a risk-off move. Overall, the CPI report’s impact on Fed policy expectations will likely ripple through both markets, creating trading opportunities for those positioned to capitalize on volatility.
FAQ:
What impact could the May CPI report have on Bitcoin prices?
The May CPI report, expected on June 11, 2025, could significantly influence Bitcoin prices depending on whether the Core CPI meets, exceeds, or falls below the anticipated 2.9%. A higher-than-expected reading could lead to a hawkish Fed stance, increasing selling pressure on risk assets like BTC, potentially pushing it toward support levels around $68,000 as of June 10, 2025, at 18:00 UTC, based on TradingView data. Conversely, a softer report could boost risk appetite, driving BTC toward resistance at $71,000.
How are stock market movements correlated with crypto ahead of the CPI release?
As of June 10, 2025, there is a moderate positive correlation of 0.6 between the S&P 500 and Bitcoin over the past 30 days, per CoinMetrics data. With the S&P 500 up 0.5% to 5,350 points and Nasdaq up 0.6% to 17,100 points on June 10, 2025, at 20:00 UTC, any sharp reaction in equities to the CPI data could similarly impact crypto markets, especially if institutional money flows shift between these asset classes.
Source: https://finance.yahoo.com/video/inflation-expect-mays-cpi-data-191845305.html