• The crypto market has been on a roll recently, with total market capitalization rising by 14% since the start of the year.
• However, the World Bank is predicting that the global economy can slip into recession, which could be devastating for the broader financial market.
• Core inflation across countries is also hurting the global economy, with median inflation for emerging and developing economies at 48% and 32% for advanced economies.
The crypto market has been seeing a surge of growth in recent months, with Bitcoin and Ethereum leading the charge. This has caused total market capitalization to rise by a whopping 14% since the start of the year. However, the World Bank is predicting that the global economy may enter a recession, which could be disastrous for the entire financial market.
The World Bank’s latest blog post states that the global gross domestic product (GDP) is expected to grow by only 1.7% annually, the lowest since the two previous recessions. Core inflation across countries is also having a detrimental effect on the global economy. Median inflation for emerging and developing economies is at 48%, while advanced economies have a median inflation of 32%.
If the global economy does slip into a recession, governments are likely to tighten their fiscal policies in response. This could be disastrous for the crypto market, as investors could flee to safe-haven assets, taking their cash with them. The upcoming Consumer Price Data will provide some insight into the U.S. Federal Reserve’s plans, which could give an indication as to what the future holds for the crypto market.
Overall, the potential of a global recession is a cause for concern for the crypto market, and it will be interesting to see how it responds to the worsening macroeconomic situation. The Consumer Price Data will be a crucial indicator to watch in the coming weeks, and it could give some indication as to how the market may fare in the future. Until then, the crypto market will remain in a state of flux, with investors and traders cautiously watching the situation.