Bitcoin Up, Then Under $30k on CPI

Softer-than-expected US inflation data for March briefly sent Bitcoin to $30,400, but the asset failed to keep the gains.

Burning dollar bill, art generated by Midjourney

Bitcoin price whipsawed following the improvement in the US Consumer Price Index (CPI) data that rose 0.1% in March, a notable decrease from 0.4% in February. The US stock indices posted moderate gains, with S&P 500 adding 0.37% and Nasdaq up 0.07%.

On a year-to-year basis, March CPI was up 5%, below estimates of 5.1%, marking the slowest annual increase since May 2021. Core inflation, which doesn’t take into account volatile food and energy prices, came in at 5.6% and 0.4% respectively, in line with the economists’ forecasts.

“The all items index increased 5.0 percent for the 12 months ending March; this was the smallest 12-month increase since the period ending May 2021. The all items less food and energy index rose 5.6 percent over the last 12 months. The energy index decreased 6.4 percent for the 12 months ending March, and the food index increased 8.5 percent over the last year,” the U.S. Bureau of Labor Statistics stated in a press release.

“Looks like this report also squeaked through without recent energy/fuel prices hitting. Explains some of the disconnect between things like consumer inflation survey and the actual CPI data here. Shelter and transport led this one still,” crypto researcher and venture capitalist Adam Cochran commented on inflation figures.

For context, the US Consumer Price Index measures the change in prices paid by consumers for a basket of goods and services that includes food, energy, shelter, medical care, and transportation services. The index is one of the most widely recognized tools to measure inflation and deflation.