A closely followed economist is tracking inflation data as he believes the next update will set the direction of the crypto markets.
Alex Kruger says inflation is now the Federal Reserve’s number one concern. According to economists, the Fed has been hawking as it considers multiple rate hikes and reduced asset purchases this year to combat rising inflation.
Kruger emphasizes that if the Fed carries out its plans, the lack of liquidity in the system could negatively affect the crypto markets.
With Bitcoin (BTC) falling over 40% from its all-time high, Kruger says the latest consumer price index (CPI) data, a tool for measuring inflation, could identify the next phase of the crypto market cycle.
Kruger also said he believes the Fed is ready to see market dips just to keep inflation in check.