Inflation in the United States accelerated unexpectedly in January, pushing both cryptocurrencies and traditional markets sharply.
The Consumer Prices Index (CPI) increased by 0.5 % month to the month, exceeding 0.3 % expectations and an increase of 0.4 % in December.
On an annual basis, the consumer price index increased by 3.0 %, compared to 2.9 % expectations and December reading 2.9 %
Core Core CPI, which excludes flying food and energy prices, increased sharply, an increase of 0.4 % month, with expectations by 0.3 % and 0.2 % in December. Annually, Core CPI reached 3.3 %, higher than 3.1 % and 3.2 % in December.
Bitcoin (BTC) decreased sharply, and less than 95,000 dollars fell immediately after the inflation report.
Bitcoin has been trading in a range ranging from $ 90,000 – $ 109,000 since November, with inflation numbers increased today from the possibility of re -testing of the lower limb of this range.
Regardless of Bitcoin, American stock futures decreased by about 1 %, while the treasury revenue increased for 10 years, 10 basis points to 4.63 %.
Red encryption market
The ceiling of the Crypto global market is $ 3.12 trillion, which reflects a 1.85 % decrease over the past 24 hours.
The total size of the cryptocurrency market over the same period increased by 13.82 % to 109.54 billion dollars.
Bitcoin is currently trading 1.95 % at 94,986 dollars.
The dominance of the market in Bitcoin increased slightly by 0.07 % to 60.37 %.
The main altcoins such as XRP, Solana (Sol) and Ethereum also feel heat.
XRP and Solana decreased by more than 3 %, while Ethereum decreased about 2 %.
Prices of encryption expectations
The encryption market has been volatile, due to the lack of positive incentives. The consumer price index data has increased the number of trading feelings, indicating possible declines.
The printing of the most powerful inflation is expected amid the recent comments of the Federal Reserve Chairman, Jay Powell, as he indicated that more cuts in interest rates are not likely unless the economic conditions are exacerbated significantly.
The restricted monetary policy continued to determine the bitcoin capabilities, as the higher interest rates increase the attractiveness of traditional financial assets such as bonds and savings accounts, making them more attractive than the most dangerous assets such as cryptocurrencies.
According to the CME Fedwatch tool, the possibility of maintaining the current target rate of 4.25 % -4.50 % increased in the FOMC meeting from 18 to 19 March to about 98 %, up from 95 % before the data version.
On the contrary, the possibility of a rate of 25-basis decreased to about 2 %, with a decrease from 5 %.
Today’s market data can push prices at the potential prices for the year 2025.
The threat of continuous inflation, along with geopolitical and driving fears of artificial intelligence around China, still raises uncertainty about market performance.
Selling pressure appears to be likely to continue in the short term. Traders now convert their focus into inflation data in the upcoming product price index (PPI), which is scheduled to be released tomorrow.
If the producers’ price index is in line with the consumer price index data, this may exacerbate the emotional feelings and may lead to an additional decrease in the encryption market.
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