- Inflation rose 2.8% y-o-y and 0.2% in February, both below expectations, indicating a slower pace of consumer price increases, as reported by the U.S. Bureau of Labor Statistics
- Bitcoin surged 1.73% following the lower-than-expected CPI report, showing resilience and optimism despite this week’s broader market struggles and economic uncertainties
- Analysts suggest that the lower inflation readings might signal less urgency for interest rate hikes, influencing market sentiment and benefiting growth-oriented assets like Bitcoin
American inflation rose 2.8% on a yearly basis and 0.2% in February. Both readings reported by the U.S. Bureau of Labor Statistics reveal a slight increase in consumer prices, despite the Fed’s long-lasting battle to tame inflation at 2%.
Analysts predicted the CPI readings to reveal a 2.9% year-over-year inflation rate and a 0.3% in February. The fact that both numbers came out a decimal lower than expected reveals that inflation may not be spiking as fast as expected by experts.
This report will serve as a key reading for the Federal Reserve to decide if the American interest rate will decrease, stay the same, or increase in the upcoming FOMC meeting on March 18-19. While a significant interest rate decrease still seems unlikely given the economic uncertainty regarding the United States’ foreign policy — it will likely serve as confirmation that there is no need to raise interest in the upcoming meeting.
Bitcoin Reacts to CPI Report
The world’s largest cryptocurrency reacted favorably to the lower-than-expected CPI reading. Only a couple hours after the report, Bitcoin rose by 1.73% according to CoinMarketCap — currently trading at $81,749.
Moreover, the asset has increased by 0.98% over the last 24 hours. Despite this week’s meltdown in the market, Bitcoin buyers have shown incredible strength over the last 2 days, driving BTC up by 6.71% since this week’s lowest point.
With the Federal Open Market Committee (FOMC) meeting scheduled for March 18-19, Bitcoin’s movement may remain relatively muted in the short term as investors await clarity on the Federal Reserve’s interest rate decisions.
Hey! If you’re looking for a place to trade, why not give our partner WEEX a chance? Check out this link for an exclusive 50% deposit bonus.
The information provided in this article is for informational and educational purposes only and does not constitute financial, investment, or trading advice. Any actions you take based on the information provided are solely at your own risk. We are not responsible for any financial losses, damages, or consequences resulting from your use of this content. Always conduct your own research and consult a qualified financial advisor before making any investment decisions. Read more
