According to forecasts, the Consumer Price Index for December showed an increase of 6.5%. The U.S. Bureau of Labor Statistics has released the December CPI figures. The cryptocurrency market was only somewhat upbeat before the report’s release, with most assets trading in positive territory. The Consumer Price Index, which tracks inflation, showed 7.10% in November.
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The release of the U.S. Consumer Price Index (CPI) for the month of December 2022 was met with enthusiasm by Bitcoin and the rest of the cryptocurrency industry. Over the coming days, bullishness in the stock market is also anticipated. However, according to some industry insiders, this excellent news may have been a one-time event that sent the price of BTC and other crypto assets through the roof.
BREAKING: 🇺🇸 CPI 6.5%, lowest inflation rate since Oct 2021
— Bitcoin Magazine (@BitcoinMagazine) January 12, 2023
As U.S. inflation approaches its most significant level in two years, interest in bitcoin and other cryptocurrencies is multiplying.
The increased interest from institutional investors, many of whom think Bitcoin is a better store of value than conventional fiat currencies, has been attributed to the higher bitcoin price.
Furthermore, with their positive vision of the future of digital assets, crypto bulls are pushing the market higher. Thanks to their growing use, Bitcoin and other cryptocurrencies may eventually challenge established monetary systems.
According to the consumer price index, inflation ended 2022 with a 6.5% annual reading, as the U.S. Bureau of Labor Statistics reported on Thursday. It matched what economists had predicted. Come as a feasible replacement for conventional monetary systems.
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Some economists, however, need to be more knowledgeable about the sustainability of the inflation projected for the future. Stock broker and CEO of Euro Pacific Capital, Peter Schiff, predicts that inflation will increase again. Tweeted Schiff.
A one-month, .1% dip in #CPI doesn't mean #inflation is cooling off. The core was up .3%, which annualizes to 4%, double the #Fed's 2% target. YoY CPI still rose 6.5% and with the dollar weakening, federal budget deficits & consumer credit soaring, inflation is poised to heat up.
— Peter Schiff (@PeterSchiff) January 12, 2023
With an increase of just 6.50% year over year, inflation in the United States is at its lowest level since October 2021. It was reasonable that the crypto market first responded by dropping prices in response to the CPI numbers, but investors may ultimately benefit from lowering inflation.
If inflation is controlled, crypto traders may save money on their everyday living expenses. This suggests that dealers save money aside for long-term investments like cryptocurrencies.
Bitcoin 24-Hour Price Analysis
As BTC increased from $17,890, the price of bitcoin turned the $20k immediate resistance level into a support level. Continuing its upward trend, BTC broke through the resistance block’s lower boundary at $17,929 to $18,829,
- Bitcoin Analysis
Following the bulls’ takeover of the BTC market, the Bitcoin (BTC) market is bullish. After a bullish trend, bulls in BTC drove prices to an intraday high of $19800 before running into resistance. Due to the positive direction, BTC has increased in value by 5.97% at the time of publication to $19,898.92.
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The bullish run led to a $5.85% increase in market capitalization to $383,681,794,224 and a 22.03% increase in 24-hour trading volume to $28,599,301,691. Therefore, expectations for BTC’s future are high because, at least in the medium term, this growth has kept investor confidence in BTC.
If the general market bullishness continues over the coming trading sessions, the king coin may also be able to retake the FVG’s upper limit at $20k as support. This would allow it to start a comeback rally to new highs.
Even more significant gains may be feasible soon if bulls in the Bitcoin market drive prices higher past current resistance above $20,000.
What is CPI?
The index tracks how quickly the average price of a basket of goods and services, including consumer electronics, food, utilities, and athletic event tickets, increases or decreases.
Deflation, or falling prices generally, is not necessarily what consumers experience just because the yearly inflation rate falls. In December, the yearly rate remained positive. Prices increased more slowly this year than earlier because of the drop in the annual inflation rate.
The CPI calculation considers several variables, including changes in the cost of goods like food, housing, transportation, and healthcare. Economists can spot trends in consumer purchasing patterns and forecast future inflation rates by monitoring the CPI figures over time.
To manage personal finances and make wise investment decisions, it is crucial to comprehend how the US CPI operates.
For households, a continued slowdown in inflation would be a welcome relief. Since the average person’s income has grown more slowly than the pricing of the goods they consume, they now have less purchasing power.
The U.S. Department of Labor reports that, after considering inflation, hourly wages have decreased by 1.7% over the past year.
According to a December Moody analysis of the yearly inflation rate, the typical household will need to spend $371 more per month to purchase the same products and services as they did in December.
This spells out that the CPI is a key factor for where cryptocurrencies will go next. But as from the data given by the U.S. Bureau of Labor Statistics, a possible upswing is imminent.
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