Upon the BLS report, the prices of major cryptocurrencies, like Bitcoin and Ethereum, rose by over 1%.
Cryptocurrencies see gains as the United States inflation data shows promising progress in the Federal Reserve’s efforts to combat rising prices.
On May 10th, the Bureau of Labor Statistics (BLS) revealed that in April, the Consumer Price Index (CPI) increased by 4.9% over a 12-month period.
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The figure falls slightly below the anticipated 5% forecasted by economists. Comparatively, the index climbed 0.4% in April, following a 0.1% rise in March and a 0.4% growth in February.
The Customer Price Index (CPI) is a tool that tracks price changes among various products and services.
As a result, Bitcoin (BTC) experienced a 1.4% daily boost, offsetting its 0.22% weekly losses and trading at around $28,120, according to BitDegree data.
Ethereum followed suit, posting a 1.43% daily increase and reversing its weekly decline, trading at $1,875. Consequently, the global crypto market capitalization reached $1.2 trillion, marking a 0.84% increase from May 9th.
Following the news, the chart turned green for other cryptocurrencies, including XRP, Cardano (ADA), HEX (HEX), Lido stETH (STETH), and Dogecoin (DOGE), among others.
The BLS attributed the index’s growth in April to a surge in housing prices, which rose by 0.4% on a monthly basis. However, this represents a decline compared to the 0.6% increase in March and the 0.8% growth in February.
The report further revealed that core inflation, excluding fluctuating food and energy costs, climbed by 5.5% over the 12-month period ending in April, a slight decrease from 5.6% in March.
In general, inflation has gradually cooled down in recent months, dropping significantly from a peak of 9.1% in June. Despite this, the latest data indicate that annual inflation remains well above the Fed’s 2% target.
In response to rising prices, the US central bank has aggressively raised interest rates, reaching their highest levels since 2007 and marking the 10th consecutive rate hike last week.
Cryptocurrencies are experiencing a boost as US inflation shows signs of slowing down, highlighting the impact of economic indicators on the crypto market.
At the end of March, Coinbase listed “flatcoins,” inflation-pegged stablecoins, as one of the four priority areas the firm would want the developers to explore on its newly launched Layer-2 network “Base.”
by Gile K. – Expert Reviewer, BitDegree
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