Markets
Bitcoin rose 3.5% as US data showed consumer prices slowed their rise in April
The price of Bitcoin rose after U.S. data showed inflation was stickier than expected in April. Consumer prices in April were 3.4% higher than in the same period last year. According to the U.S. Bureau of Labor Statistics, this is a sharp slowdown in price growth from 3.7% in March.
Immediately after the BLS released its new data on the consumer price index, the price of Bitcoin is now at $63,142, data from CoinGecko shows. This is an increase of 3% in the last 24 hours and 1.4% more than an hour ago.
And the price of Ethereum, the second largest digital asset by market capitalization, is now $2,944.94, which is up 1.8% from yesterday and 2% from an hour ago.
The CPI ratio measures price changes in a basket of common consumer goods and services and is used to estimate changes in the economy’s inflation rate. In today’s report, which contains consumer price data for the month of April, the BLS reported that home prices and gas were the two biggest drivers of the price increase.
“These two indices together contributed more than 70% of the monthly increase in the index for all items,” the BLS writes in its summary.
Economists initially expected the Fed to lower interest rates early this year, but now many think a cut will come by September, Reuters survey showed this week.
US stocks, especially technology stocks, rose, with the NASDAQ-100 Technology Sector Index (NDXT) rising
gaining 72 points to trade up 0.72% from yesterday. Meanwhile, the S&P 500 gained 0.48% ahead of the US markets open.
Bitcoin hit a new high of nearly $74,000 per coin in March. Its surge occurred at the end of January approved stain Bitcoin exchange-traded funds (ETFs).which led to an influx of capital into the market.
But data showing that inflation will not disappear and therefore the Fed is in no hurry to lower historically high interest rates has halted the asset run. When interest rates are high, investors tend to “de-risk” and avoid assets like Bitcoin.
As a result, the virtual currency traded this month and last well below its 2021 record of $69,044.
Previously experienced said Decipher that the price of Bitcoin would continue to rise if interest rates fell.
By Stacy Elliott.