Cooling Signals in US Inflation Spark Discussions on New Monetary Policy

Real-time inflation measurement metrics from Truflation reveal a much faster decline in price pressures in the United States than official government data indicates. Although the Federal Reserve remains cautious in considering interest rate cut scenarios, the divergence between real-time US inflation readings and traditional monthly reports continues to widen, reigniting discussions among policymakers and global financial markets.

US Inflation Data Dynamics: Alternative Perspectives

According to Truflation’s calculations, the US Consumer Price Index (CPI) registered a 0.86% year-over-year level last weekend, a sharp drop from 1.24% the day before. The US core Personal Consumption Expenditures (PCE) inflation proxy— a key metric for the central bank—stands at 1.38%, well below the Federal Reserve’s 2% comfort zone target.

A significant difference is evident when compared to official data: traditional CPI showed 2.7% in December, while core PCE reached 2.8% in November. Truflation’s platform collects millions of daily price points across various sectors—real estate, food, energy, insurance, and services—offering a dynamic view of price pressures compared to lagging monthly statistical releases.

Uncertainty in Fed Policy and Risk Market Implications

As US inflation data signals a slowdown, the Federal Reserve has just halted its interest rate cut cycle and signaled uncertainty regarding near-term monetary easing. Some market participants believe policymakers may respond more slowly to the accelerating inflation conditions.

Interest rate expectations are closely tied to dollar liquidity flows and global risk appetite. Historically, when inflation weakens and rate cuts occur, the dollar tends to weaken— a dynamic that traditionally supports high-risk assets including Bitcoin and the entire cryptocurrency ecosystem.

US Dollar Faces Technical Critical Point

Chart analysis shows the US dollar index recently broke through a long-standing support level that has held for over a decade. This breach increases the likelihood of a continued downward trend if bearish momentum is further confirmed.

Leading macro investors, including Real Vision founder Raoul Pal, have previously expressed the view that a structural weakening of the dollar would be beneficial— easing debt payments denominated in USD worldwide and supporting assets dependent on global liquidity expansion.

Upcoming Scenarios: Pressure on Fed Stance

If alternative US inflation data continues to show significant divergence from official readings, additional pressure is likely to mount on the Federal Reserve to reconsider its monetary policy stance. This scenario could further energize the cryptocurrency markets and other asset segments sensitive to interest rate changes and global risk sentiment.