Bitcoin bursts over $26,000 after the Consumer Price Index (CPI) comes at an expected rate of 6.0% Year-over-Year (YoY.)
The US CPI increased by 0.4% Month-over-Month (MoM) in February, equivalent to the forecast rate. At the same time, the core CPI, which excludes the food and energy sector, increased by 0.5% MoM, 0.1% higher than the forecast of 0.6%.
The MoM core CPI has also increased by 0.1% from last month’s data of 0.4%.
YoY, the CPI increased by 6.0%, equivalent to the forecast, and the Core CPI also increased at par with the estimated rate of 5.5%.
The transportation and Gas utility sector had the largest price changes over a year, 14.6% and 14.3%, respectively.
Bullish Bitcoin Crosses $26,000
As the CPI data came out equivalent to the estimated numbers, the price of Bitcoin shot up over $26,000. Within 30 minutes of the announcement, Bitcoin skyrocketed more than 6.5%; however, as of writing, it is trading at around $25,791.
Simultaneously, the second largest cryptocurrency – Ethereum, also rallied over 5.5%. It is currently trading at $1740 after touching $1765.
According to Coinglass, over $85 million worth of trades were liquidated in 1 hour after the announcement from The Bureau of Labor Statistics.
Economist Peter Schiff Predicts Rising Inflation
The renowned economist Peter Schiff has a hawkish stance and believes that inflation will likely shoot up. He considers that inflation has yet to reach its target of 2% despite all the interest rate hikes.
He says, “Since the Fed is basically done hiking, the most likely direction for CPI from here is up.”
The next Federal Market Open Committee (FOMC) meeting is on Mar. 22, 2023. There is an 86.4% probability of a 25 bps interest rate hike in the next FOMC meeting.
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