Key Points
- Bitcoin and major equities rallied after April’s U.S. Consumer Price Index (CPI) data indicated an easing of inflation.
- Broader markets are processing the CPI report which could influence the Federal Reserve’s decisions on rate cuts.
On Wednesday, Bitcoin experienced a surge, mirroring the trend seen in major equities. This rally was triggered by the U.S. Consumer Price Index (CPI) data for April, which showed a slight decrease in inflation.
The April CPI data, released by the U.S. Bureau of Labor Statistics, marked a year-on-year gain of 3.4%. This figure was a slight decrease from March’s 3.5% increase.
Bitcoin’s Performance Amidst Easing Inflation
Bitcoin’s price rose by 3% in the past 24 hours and was trading at $63,751 at 9:20 a.m. ET. Concurrently, stock futures increased after the recent CPI report, which aligned with economists’ predictions. The Nasdaq Composite saw a rise of 0.81%, while the NYSE Composite increased by 0.48% in pre-market trading.
The broader markets are currently interpreting the latest U.S. CPI report. The report suggests that inflation eased in April, a development that could potentially influence the Federal Reserve’s decision to initiate rate cuts.
Market Reactions and Predictions
This report follows a series of higher-than-expected inflation readings. These readings had previously led traders to reduce their predictions on when rate cuts might occur this year.
According to the CME’s FedWatch tool, interest rate traders are speculating that the Fed will maintain rates in June before potentially implementing its first cut in September. The chances of rates remaining stable in June are 91.6%, and in July at 65.1%. However, the odds of a rate cut in September are given as 51.4%.
In the past 24 hours, the GM 30 Index, which represents a selection of the top 30 cryptocurrencies, has risen by 1.92% to 130.16.
