Bitcoin jumped more than 5% on Tuesday evening Hong Kong time, after the U.S. Bureau of Labor Statistics said that the consumer price index (CPI), a key inflation indicator, was up 7.1% in November from a year earlier, less than the expected 7.3% and down from 7.7% in October. The CPI rose 0.1% in November from October.
See related article: Crypto market implosions, bankruptcies bring sweeping job losses … and opportunity
- Bitcoin was trading at US$17,888 at 10 p.m. Hong Kong time, up from as low as US$16,979 in the last 24 hours, according to CoinMarketCap data.
- The largest cryptocurrency by market capitalization has slumped more than 70% from its bull run of 2021 when it reached a record high of over US$68,000. Bitcoin’s value has been dropping to yearly lows since the collapse of FTX, once one of the world’s largest cryptocurrency exchanges.
- All cryptocurrencies in the top 10, excluding stablecoins, were up after the CPI data was released, according to CoinMarketCap data.
- The S&P 500 opened 2.64% higher on Tuesday than the previous close while the Nasdaq Composite was up 3.34%.
- Despite a slowdown in inflation, the U.S. Federal Reserve is likely to increase interest rates by half a percentage point on Wednesday, after raising rates by 75 basis points in the past four consecutive meetings.
- “The central bank will argue it needs to continue with rate rises to bring inflation back to target. However, with signs of slower prices and a cooling labor market, they could be playing with fire,” Nigel Green, chief executive of financial advisory firm deVere Group, said in a statement shared with Forkast.
- The core CPI, which excludes energy and food prices, rose 0.2% in November, and 6% over the last 12 months, retreating from 6.3% in October and a four-decade high in September.
- See related article: Markets: Bitcoin, Ether rise; BNB is biggest loser in top 10 cryptos