Following its largest drop in over two years, Bitcoin finally picked itself up today.
The world’s largest cryptocurrency grew by over 10% after the most recent release of the Consumer Price Index, by the United States Labour Department.
According to the Labor Department, the Consumer Price Index (CPI) climbed 0.4% in October, significantly less than the 0.6% expected. The annual rate fell to 7.7%, against expectations of 8%, and was down from 8.2% in September.
The report allowed Bitcoin to gain over $1,500 in value minutes after the report went through, currently trading at around $17,700, according to Coinmarketcap.
The numbers for the price index that exclude food and energy costs (a.k.a. “Core CPI”), were even better for the digital asset. In October, the core CPI decreased by 0.1% when compared to September’s release.
Annually, core CPI rose 6.3% in October, less than expected at 6.5%, and down from 6.6% in September.
FOMC Meeting In December
After the exciting news regarding the moderate CPI decrease, investors are eagerly waiting for the next U.S. Government meeting that has the potential to impact cryptocurrencies.
After the October CPI statistics release, the FED will use this data to decide on the next conference scheduled for December 14-15.
At that meeting, the FOMC will almost certainly raise its benchmark Fed Funds rate for the seventh time. However, despite more interest raises – any signal that the Federal Reserve is on the verge of stabilizing inflation will be good news.
In fact, Jerome Powell – Fed’s chairman – said that the Fed may halt its three-quarter-point rate hike pace in December or January.
Powell went on to suggest during the FED announcement that America’s interests might be approaching “restrictive territory.” He went on to warn that in the near future, it will be critical to “lower the rate of rises.” However, the FED has yet to make an official decision.
Can Bitcoin Return to $20k in The Near Future?
Before the FTX disaster which brought down the entire crypto ecosystem along with it to the ground – Bitcoin was in one of its best moments in 2022.
The asset spent the majority of September/October toying under the $20,000 mark (an important resistance line for the currency). However, after the Federal Reserve begin signaling a slowing down of interest raises – the asset gained value and begin starting to look like it was on its way to reaching $22,000.
The most recent FTX turbulence was very atypical – meaning that after the dust settles and the market regains trust in cryptocurrency exchanges. Bitcoin could return back to the $20,000 mark and start to hope for even bigger steps.
