Major Cryptocurrencies Struggle as Hang Seng Cheers U.S.-China Trade Talks; U.S. Inflation Eyed as China Deflation Worsens

Major cryptocurrencies confirmed little bullish momentum Monday, even as hopes for the U.S.-China commerce talks lifted Asian shares.

Bitcoin

, the main cryptocurrency by market worth, traded flat-to-negative close to $105,650, having carved out a doji candle, an indication of indecision, on Sunday, based on knowledge supply TradingView.

Data from Blockchain.com confirmed a marked slowdown in community exercise, with the seven-day shifting common of day by day on-chain transactions falling to 315.48K, the bottom in at the very least a yr.

Payments-focused cryptocurrency XRP struggled to assemble upside traction regardless of topping a bearish trendline from the mid-May highs. The cryptocurrency modified fingers at $2.24 at press time, down over 1% on the day (UTC). Volatility could enhance this week as the XRP Ledger’s APEX 2025 convention kicks off in Singapore.

Meme cryptocurrency DOGE traded almost 2% decrease, closing in on 18 cents, having failed to ascertain a foothold above the 100-day easy shifting common (SMA) over the weekend.

Hang Seng tops 24K

Hong Kong’s Hang Seng index rose 1.3%, topping the 24,000 mark for the primary time since March 24, based on knowledge supply TradingView. The transfer got here in response to the optimism in regards to the U.S.-China commerce talks this week.

“Optimism is as high as it’s been since Trump’s election as top trade deputies will meet in London starting on Monday. There are indications that talks will go all week and Trump himself is optimistic,” Foreign exchangeLive’s Chief Currency Analyst Adam Button stated in a weblog put up.

“The meeting should go very well,” President Donald Trump stated on Truth Social Friday, asserting the brand new spherical of commerce talks in London.

Other Asian indices, such as South Korea’s KOSPI and China’s Shanghai Composite, additionally gained floor regardless of the deepening client and manufacturing facility gate deflation in China.

China’s deflation worsens

China’s client costs fell 0.1% year-over-year in May, based on knowledge from the National Bureau of Statistics launched on Monday. The CPI first turned damaging in February.

Meanwhile, the producer worth index, or manufacturing facility gate costs, fell 3.3% year-over-year in May, registering a sharper decline than the three.2% drop analysts had anticipated. Factory gate costs have been in deflation since October 2022.

According to Robin Brooks, senior fellow within the Global Economy and Development program on the Brookings Institution, the U.S. tariffs are producing a deflationary shock for main exporters like China.

“China’s producer price inflation for consumer goods is down to its lowest level since the 2008 crisis. U.S. tariffs will now push China into full-on deflation. All necessary conditions for deflation are there: weak consumption and a debt overhang. U.S. tariffs are now the catalyst…,” Brooks stated on X.

The worsening deflation might immediate China to stimulate home demand with additional liquidity easing.

China’s central financial institution in May minimize the key rates of interest by 10 foundation factors to a historic low whereas decreasing the reserve requirement ratio, releasing liquidity into the market. Last week, the state-run China Securities Journal reported that the People’s Bank of China could decrease the reserve requirement ratio additional later this yr to help progress and restart authorities bond buying and selling.

More Chinese stimulus might bode effectively for monetary markets, together with cryptocurrencies.

Focus on U.S. CPI

The U.S. client worth index for May due Wednesday might be scrutinized by markets for clues that Trump’s tariffs are including to cost pressures within the economic system.

The headline CPI is seen matching April’s tempo of 0.2% month-on-month progress, equating to an annualized 2.5% rise versus April’s 2.3% enhance, based on FXStreet. Meawhile, the core inflation, which excludes the risky meals and vitality part, is forecast to have ticked increased to 2.9% in May from 2.8% in April.

Economists at Barclays count on the info to indicate first indicators of tariffs-related worth will increase throughout wide selection of core items.

A warmer-than-expected print might dent Fed fee cuts, doubtlessly injecting draw back volatility in monetary markets.