Bitcoin Price Soars Due To US Inflation Data Announcement
JAKARTA - Bitcoin has surged again past the figure of US$63,000 (around Rp1.01 billion) after being shaken by sales pressure. Now, Bitcoin is moving with an increase of 2.96% at a price of 62,715 US Dollars (around Rp1 billion), with a market capitalization of 1,235 trillion US Dollars (around Rp. 18,525 trillion).
An interesting phenomenon is the significant increase in Bitcoin's daily trading volume, reaching 76% with a total of more than 23 billion US Dollars (around Rp370 trillion). This increase in activity comes ahead of the announcement of US inflation data that market participants have been waiting for.
From an economic perspective, America faced a slowdown in contrast to its strong economic performance in the previous year. Labor data in April showed growth not as strong as market estimates.
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If this trend continues, the Federal Reserve may be forced to cut interest rates to avoid a deeper economic downturn. Investors are also looking forward to confirmation of sustainable inflation, which will provide a clearer picture of the scale, time, and possible cuts in interest rates in the future.
All eyes are now focused on the US Consumer Price Index (CPI). On Tuesday, May 14, data on the Producer Price Index (PPI) will be released, followed by the announcement of CPI on Wednesday.
Ahead of this inflation report, the FedWatch CME tool estimated a 24.6% chance of cutting interest rates at a FOMC meeting in July, and 48.6% at a September meeting. Meanwhile, interest rate traders expect 96.5% chance that interest rates will remain unchanged at a June meeting. Analysts from QCP Capital stated:
Unless the Fed explicitly removes the possibility of cutting interest rates or signaling about rising interest rates, the market will most likely continue to predict cuts. This hope can maintain bullish sentiment in the market for a while.
Currently, the price of Bitcoin has managed to hold above the key support level of 60,000 US dollars (around Rp966 million). Bitcoin's market capitalization reached Rp19.9 quadrillion with a trading volume at the level of Rp427 trillion.