Bitcoin surges to highest in more than a month after reading milder-than-expected inflation
Cryptocurrencies have been under enormous pressure following the collapse of the so-called stablecoin called terraUSD.
Umit Turhan Coskun | Nurphoto via Getty Images
Price of bitcoin spiked on Tuesday following the release of the much-anticipated consumer price index report.
Bitcoin was last 5% higher at over $17,900, according to Coin Metrics. At one point, it climbed as high as $17,957.35, the highest in more than a month. ether rose 6.5% to $1,339.
The US November consumer price index, which measures a broad basket of goods and services, rose only 0.1% month-on-month, the US government said on Tuesday.
Economists surveyed by Dow Jones were expecting a 0.3% monthly gain. This boosted investor hopes that the Federal Reserve will slow the pace of its rate hikes.
Year-on-year, the index rose 7.1%, versus expectations of 7.3%.
The lighter-than-expected report sent 10-year Treasury yields lower. Rising yields make future returns, like those promised by growth-oriented, higher-risk companies, less attractive.
According to Noelle Acheson, an economist at the Crypto is Macro Now newsletter and a former head of market insights at Genesis, the post-CPI gain followed another spike from early morning, which indicates pressure buying is increasing.
“It seems like a lot of people are starting to accept that a bottom may have formed and these are potential accumulation levels,” she told CNBC.
“Uncertainty around the next contagion remains a key issue and any bad news could drive prices much lower, but smart investors are weighing the probabilities at this point,” she added. this”.
The move comes as investors continue to monitor and assess the collapse of the once popular exchange FTX, whose head Sam Bankman-Fried was charged by the Securities and Exchange Commission yesterday Tuesday for defrauding investors. Concerns about customers withdrawing funds from Binance, the industry’s largest exchange, are also growing.
The price of Bitcoin has been relatively stable over the past month — since the massive drop following the November FTX boom — as the macro environment continues to boost the crypto asset to some extent, even as the FTX scandal shook investors’ confidence.
