Thursday, April 25, 2024

US inflation, BTC catalysts, Venezuela and stablecoins

“If you have built castles in the air, your work need not be lost; that is where they should be. Now put the foundations under them.” – Henry David Thoreau ||

Hello everyone, I hope you’re all doing well! I truly do not understand how it got to be Thursday so fast.

I apologize, yet again I have to skip the audio recording, I’m not at my desk this morning.

If you find this newsletter useful, would you mind sharing it with your friends and colleagues? ❤

IN THIS NEWSLETTER:

• Inflation day tomorrow

• Upcoming catalysts: Hong Kong, SAB 121 and more…

• Venezuela and stablecoins

If you’re not a subscriber to the premium daily, I hope you’ll consider becoming one! You’ll get ~daily insight into the growing overlap between the crypto and macro landscapes, as well as some useful links, and (usually!) access to an audio read of the content. And there’s a free trial!

WHAT I’M WATCHING:

Inflation day tomorrow

With the preliminary US Q1 GDP growth figures dropping today (I wrote about this yesterday), tomorrow’s economic data is potentially even more significant. It’s time for the monthly circus around the Fed’s preferred inflation gauge: growth in the Personal Consumption Expenditure (PCE) index.

March’s data is expected to remain stubborn. The consensus estimates for core index (ex-food and energy) and the headline index growth are 0.3%, the same as in February. This would push the three-month annualized rate up to 4.0% – double the Fed’s official target.

(chart via Bloomberg)

Year-on-year core PCE inflation is expected to slow down slightly, from 2.8% to 2.6% – although the Cleveland Fed’s Inflation Now model (not a forecast, a real-time estimate based on economic data) suggests it could be slightly higher, at 2.74%. The year-on-year headline index growth is expected to accelerate from 2.5% to 2.6%.

Since the PCE growth is derived from data already released with the PPI and CPI numbers, the Cleveland Fed’s model tends to be relatively accurate.