Bitcoin experienced a significant surge in value leading up to the June 12 Wall Street opening following a surprising drop in United States inflation data.
The sudden spike saw Bitcoin reach $69,636 on Bitstamp in a matter of seconds, gaining $1,500 in value. This surge was fueled by the Consumer Price Index (CPI) report for May, which showed inflation cooling at a faster rate than anticipated. The month-on-month CPI remained unchanged from the previous month, while the year-on-year figure of 3.3% was lower than the forecasted 3.4%.
The news was welcomed by risk assets, including the cryptocurrency market, which had been under pressure prior to the CPI report. Attention now turned to the upcoming June meeting of the Federal Reserve’s Federal Open Market Committee (FOMC), where decisions on interest rates and economic outlook would shape market sentiment.
Financial commentator Tedtalksmacro expressed optimism, suggesting that the CPI data had paved the way for Federal Reserve Chair Jerome Powell to consider easing financial policy. Meanwhile, Michaël van de Poppe noted the decline in the U.S. dollar’s strength following the release of the data, indicating market expectations of imminent rate cuts.
Bitcoin managed to recover from losses incurred due to previous U.S. employment data, with further market volatility expected as more economic figures were scheduled for release. Market bets on potential rate cuts also shifted, with the September FOMC meeting now showing a probability of over 70%.
As Bitcoin continued to react to economic data and market sentiment, investors were advised to conduct their own research and exercise caution when making investment decisions.