Since Friday afternoon, the price of XRP (XRP +1.36%) has traded over 5% higher, as of 10:10 a.m. ET today. Cryptocurrencies appeared to gain momentum following positive economic data Friday and news on the geopolitical front.
More risk-on tailwinds
The closely watched Consumer Price Index (CPI) rose less than most economists expected in September. The CPI rose 0.3% from August and 3% year over year, 10 basis points (0.1%) lower than consensus estimates. Core CPI, which excludes more volatile food and energy prices, increased 0.2% from the prior month and also came in 3% higher year over year, also slightly lower than expected.
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While inflation is still higher than the Federal Reserve's preferred 2% target, it should give the Fed the go-ahead to cut interest rates at its meeting this week. Lower rates tend to push investors into riskier assets like crypto, which is why XRP, the world's third-largest cryptocurrency, seems to be benefiting.
CRYPTO: XRP
Key Data Points
In positive geopolitical news, U.S. Treasury Secretary Scott Bessent said on NBC's Meet The Press yesterday that U.S. President Donald Trump and Chinese President Xi Jinping are likely to meet over the next few weeks and avoid a scenario in which Trump imposes additional 100% tariffs on China. Geopolitical tensions can send investors to the sidelines and crypto is heavily impacted by broader market conditions, which is why most cryptocurrencies struggled last week.
What's next for crypto and XRP?
With the Fed likely to cut rates at its meeting this week, most investors will turn their attention to Chair Jerome Powell's post-meeting press conference for his updated thoughts on the economy and inflation. Investors will also start to think about the Fed's last meeting of the year in December and whether or not there will be another rate cut.
My position on XRP remains unchanged. I see significant potential for the token to disrupt international payments, but still find it quite volatile and therefore continue to recommend a smaller, more speculative position.
