US inflation unexpectedly fell in May,How much will , bitcoin be worth in 2025 usd which will likely lead the Federal Reserve to pause on raising interest rates this week. Following the data release, US stocks rose across the board and the US dollar weakened. However, it is worth noting that core inflation remains elevated, which will support further rate hikes in July. The S&P 500 index has entered a danger zone, so beware of downside risks.

On June 13th, the US Bureau of Labor Statistics released data showing that the US CPI rose 4% year-on-year in May, falling for the 11th consecutive month and hitting its lowest level since March 2021, with an expectation of 4.1%. The CPI rose 0.1% on a month-on-month basis, below the expected 0.2%. The core CPI rose 5.3% year-on-year and 0.4% on a month-on-month basis in May, both in line with expectations.

【Source：MacroMicro】

After the data was released, the market generally expects that the Federal Reserve will pause its interest rate hike at this week's policy meeting. The probability of no rate hike in June has risen from 79.1% to 94.2%.

【Source：CME】

US stocks closed higher, with the S&P 500 index up 0.7% and the Nasdaq 100 index up 0.8%, reaching new highs since April last year. The US dollar index fell 0.3%, easing some of the exchange rate pressures on emerging economies.

Although CPI fell more than expected, we should note that core CPI, which excludes food and energy, remains elevated, indicating persistent inflation.

The Fed is expected to hold rates steady this week but may revise its rate forecasts upward due to concerns about inflation, signaling further rate hikes. According to the latest global fund manager survey by Bank of America, people generally hold a cautious attitude towards the Fed's monetary policy, with 59% of participants believing that the Fed has not yet completed the entire rate hike cycle.

【Source：BofA Survey】

If the Federal Reserve signals a highly hawkish stance at the policy meeting, it will hit the stock market and boost the dollar. Investors should be particularly attentive.

The S&P 500 index has broken through the previous high of 4,305 points and exceeded the range of the 20-day moving average by 3%, entering a danger zone with increased risk of a pullback. If it falls below 4,305 points in the next two days, it will approach the support level of 4,179 points. Conversely, if it continues to break through this level in the next two days, it is expected to approach the next resistance level of 4,631 points.

【Source：TradingView】