Bitcoin Surges Above $93K Following Low CPI Data: What to Expect Next?

The crypto market bounced back after inflation data came in lower than expected. Core inflation rose by 0.2% for the month and 2.6% over the year, both slightly below forecasts. After the news, Bitcoin and the altcoin market saw small gains over the next few hours.

Target Rate Prediction: Fedwatch

After the data was released, stock market futures surged significantly. Investors largely stuck with their expectations that the Fed will keep interest rates unchanged at its meeting later this month and probably won’t look at cutting rates again until June, based on CME Group’s FedWatch tool.

President Donald Trump also pointed to the inflation report as he once again urged Fed Chair Jerome Powell and other policymakers to loosen monetary policy.

Since the Federal Reserve is still watching the labor market closely, the December inflation data is not expected to significantly change its policy outlook, unless it shows a clear and unexpected move in either direction.

Bitcoin and Ethereum Touch Weekly Highs

The crypto market showed some bullish trend as investors accumulated heavily following the softer-than-expected core inflation data. Bitcoin climbed about 1.7% over the past 24 hours, trading above the $93,000 mark for the first time in almost a week.

Ethereum also moved higher, approaching $3,200 and staying above the important $3,000 level, even as selling pressure remained heavy throughout the week.

The price swings led to more than $193.5 million worth of liquidations in the past 24 hours, mostly from traders holding short-positions. Short positions accounted for roughly $120.3 million of those liquidations, according to Coinglass.

Meanwhile, U.S. stock markets moved in the opposite direction. The S&P 500 slipped about 0.3% and the Nasdaq Composite fell 0.2% after both indexes opened slightly higher earlier on Tuesday.

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