Bitcoin BTC +3.44% continued its upward trajectory on Wednesday despite major equities slipping following hotter-than-expected U.S. inflation data, which diminished prospects that the Federal Reserve might cut interest rates soon.
"We do not expect the U.S. Consumer Price Index (CPI) data to end the crypto bull market yet, nor to impact prices significantly in the coming weeks. There is too much bullish momentum in crypto at the moment," Nansen Principle Research Analyst Aurélie Barthere told The Block.
The bitcoin price increased 3% in the past 24 hours and was changing hands for $72,781 at 12:32 p.m. ET, according to The Block's Price Page .
The price of bitcoin increased by 3% in the past 24 hours. Image: The Block.
However, major stock indices retreated slightly in the past 24 hours, with the S&P 500 down 0.12% and the Nasdaq Composite slipping 0.6%. In early trading in New York, Nvidia shares were down more than 3%. Shares of Meta and Apple fell 1% and 1.3%, respectively.
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The U.S. CPI release
Broader markets are digesting February's U.S. CPI report that suggested inflation is still stubbornly high, which could hinder the Fed's willingness to begin cutting rates. According to the CME's FedWatch tool , interest rate traders are betting that the Fed will hold rates steady in March and May before making its first possible cut in June. However, the FedWatch forecast puts the chances of a rate cut in June at 58%, with over 35% of interest rate traders still betting on a rate pause that month.
Barthere expects the market to adjust its rate cut expectations in 2024, to between two and three from four by the end of the year. "Right now future markets have four rate cuts priced by December 2024, this should be shaved to two to three rate cuts. We do not expect a significant sell-off for crypto as this repricing has happened in the past few months without questioning the bull market consolidation vs significant sell-off," the Nansen analyst added.
The GM 30 Index , representing a selection of the top 30 cryptocurrencies, has increased by 3.02% to 159.46 in the past 24 hours.
