- CPI data reveals higher-than-expected inflation affecting American consumers
- Concerns over Trump’s foreign policy impact on the crypto market
- Bitcoin drops over 2% following the release of CPI data
Today, the U.S. Bureau of Labor Statistics (BLS) updated the nation regarding the state of consumer prices in America.
Moving into today’s report, experts expected that consumer prices would remain stable in January. However, the Consumer Prices Index (CPI) data revealed that inflation may be affecting American consumers more than expected.
The year-over-year results showcased a 0.1% increase in January at a 3.0% total. The Month-over-Month results were even more disappointing, as analysts anticipated a 0.1% decrease, but were hit with a 0.1% increase instead.
Around the end of January, the cryptocurrency market began to halt its upward trend due to worries that Trump’s aggressive foreign policy when it comes to international trade would negatively affect it.
While it is definitely too soon to attribute the rise in consumer prices to Trump’s import tariffs, it may be enough for the Federal Reserve to decide not to decrease interest rates in the upcoming FOMC meeting on March 19.
Bitcoin Immediately Suffers CPI Impact
As soon as the CPI data came, the world’s largest cryptocurrency by market capitalization dipped in value by over 2% in less than an hour.
Bitcoin began trading on February 12 at $97,100 as buyers tried to hold on to the $97k margin. The currency reached as low as $94,826 after the CPI data. Overall, Bitcoin is at a 1.18% loss over the day, adding up to a 2.48% weekly decrease.
The Federal Reserve Chair Jerome Powell said during a testimony yesterday that the U.S. economy is doing just fine. Powell’s optimistic view of the current state of the market reassures that, despite potential setbacks as the central banking system tries to reach an inflation level of 2%, the Fed is in no rush.
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