The price of Bitcoin (BTC), the leading cryptocurrency, finished off the $64,000 level earlier this Wednesday.
The price of Bitcoin (BTC), the leading cryptocurrency, finished off the $64,000 level earlier this Wednesday.
This came after the most recent consumer price index (CPI), released today by the US Department of Labor, fell to 3.4% year over year. This is in line with analyst expectations, which explains why the price of the largest cryptocurrency saw a substantial increase. That said, a lower CPI reading would likely have triggered a more powerful price increase.
Rent and gas are currently the main drivers of inflation and contribute more than 70% of April inflation.
Index swap traders are now leaning towards a faster pace of rate cuts after the latest CPI data. The Federal Reserve is expected to reduce borrowing costs in September and December.
Of course, looser monetary policy will positively affect risk assets like Bitcoin. Last month, as reported by Guru-Investingthe largest cryptocurrency saw a sharp drop after US inflation turned out to be higher than expected. Bitcoin prices began to fall due to growing fears of stagflation, with JPMorgan boss Jamie Dimon claiming that the state of the US economy reminded him of the 1970s.
However, Federal Reserve Chairman Jerome Powell was quick to dispel these stagflation concerns, injecting some confidence into the markets.
US stock futures have also risen following the inflation data, with S&P 500 futures adding 26 points.
