Bitcoin (BTC) and Ethereum (ETH) prices skyrocketed after the US Bureau of Labor Statistics released November Consumer Price Index (CPI) data. CPI in the US fell to 7.1% from 7.7% in October. The expected CPI data was 7.3%.
Investor reaction to the lower-than-expected US inflation figures was immediately evident. In the minutes after the CPI report was released, the Bitcoin (BTC) price rallied over 5%. In the last 24 hours, the BTC price rose 6% from $16,944 to $17,913. Trading volume has risen above 31%, indicating that traders are reacting to price changes.
The decrease in CPI in November will affect the Fed’s decision to increase interest rates. Fed Chairman Jerome Powell had previously stated that there would be a slowdown in rate hikes in December and in the coming months. According to the CME FedWatch Tool, before the CPI figures were released, the probability of a 50 basis point rate hike was 72.3%. Following the CPI data, the probability of a 50 basis point rate hike increased above 80%.
You can follow the current price action here.
Disclaimer: What is written here is not investment advice. Cryptocurrency investments are high-risk investments. Every investment decision is under the individual’s own responsibility. Finally, Koinfinans and the author of this content cannot be held responsible for personal investment decisions.