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XRP is clinging to $1.35 — down more than 38% from its January highs — as traders hold their breath ahead of today’s US CPI release, a print that could either accelerate the token’s slide toward $1.20 or reignite expectations for Federal Reserve rate cuts and spark a relief rally.
Economists expect headline inflation to tick slightly higher month over month, with annual inflation projected around 2.5%, while core CPI excluding food and energy may show persistent price pressures.
For crypto investors, the outcome of the US CPI report could influence near-term rate-cut expectations and determine the next move for risk assets, including XRP.
If the US CPI report comes in hotter than forecast, analysts say it could dampen hopes of imminent monetary easing, potentially strengthening the U.S. dollar and pressuring cryptocurrencies.
A softer-than-expected print, by contrast, could revive expectations for rate cuts and trigger a rebound across digital assets.
Market sensitivity to the US CPI report reflects the Federal Reserve’s data-dependent approach to monetary policy.
In recent public remarks, Fed Chair Jerome Powell has emphasized caution in declaring victory over inflation.
“The process of getting inflation sustainably down to 2 percent has a long way to go,” — Jerome Powell, Chair, Federal Reserve.
Such statements underscore why traders view the US CPI report as pivotal. Higher-than-expected inflation could delay anticipated rate reductions, keeping borrowing costs elevated and tightening liquidity conditions that typically weigh on speculative assets.
Conversely, if inflation moderates more than expected, markets may price in earlier rate cuts, easing financial conditions and potentially supporting crypto valuations.
Risk-sensitive tokens like XRP often respond sharply to shifts in macroeconomic expectations, making the US CPI report a key catalyst for short-term volatility.
XRP is trading around $1.35, down approximately 0.6% on the day, according to daily price charts.
Since early January, the asset has remained in a clear downtrend, forming a sequence of lower highs and lower lows.
XRP failed to sustain levels above the $2.20–$2.30 region and now trades well below its 50-day Simple Moving Average (SMA), which stands near $1.84.
Ahead of the US CPI report, price action has compressed around the $1.35 level, suggesting indecision among traders.
The Chaikin Money Flow indicator sits near -0.12, indicating ongoing capital outflows and subdued buying pressure. This reinforces the cautious tone heading into the inflation release.
Immediate support lies near $1.30, followed by the recent swing low around $1.20. A decisive break below $1.20 could expose the psychological $1.00 level.
On the upside, resistance is visible near $1.40, with stronger overhead resistance at the 50-day SMA around $1.84.
Traders note that a hotter US CPI report could push XRP below $1.30 and retest the $1.20 zone.
Alternatively, a softer reading may open the path toward $1.40 and possibly $1.60 in the near term, depending on broader market sentiment.
The impact of the US CPI report extends beyond XRP, influencing Bitcoin, Ethereum, and other major cryptocurrencies.
Digital assets have increasingly traded in line with macroeconomic signals, particularly those tied to inflation and Federal Reserve policy.
Powell has repeatedly emphasized the Fed’s commitment to restoring price stability.
“We are strongly committed to returning inflation to our 2 percent objective,” — Jerome Powell, Chair, Federal Reserve.
That stance suggests policy easing will depend heavily on incoming data, including the US CPI report.
Crypto markets, which often behave as high-beta risk assets, may react sharply to any surprise in inflation figures.
A higher reading could reinforce a stronger dollar environment and suppress liquidity, while a lower print may encourage renewed risk-taking.
Beyond the headline figure, investors will scrutinize core inflation metrics, revisions to prior data, and market reactions in Treasury yields and the U.S. dollar.
These variables will shape how the US CPI report influences rate expectations and crypto pricing.
For XRP specifically, maintaining support above $1.30 may signal resilience despite macro headwinds.
A breakdown below recent lows, however, could confirm continued bearish momentum.
Ultimately, the US CPI report serves as a critical macro checkpoint for crypto investors navigating a market that remains highly sensitive to monetary policy signals.
Whether XRP stabilizes or extends its decline may depend less on token-specific developments and more on how inflation data reshapes expectations for Federal Reserve action in the months ahead.
