Bitcoin hits $100,000 mark again following cooler U.S. inflation report

Bitcoin climbed back above $100,000 on Thursday after data released on Wednesday showed that U.S. core inflation rose less than expected last month, increasing the likelihood of further rate cuts by the Federal Reserve.

Overnight, data showed the consumer price index (CPI) rose in line with expectations at an annual rate of 2.9% in December, from November’s 2.7%. But core inflation, which excludes food and energy prices, rose by 3.2%, below forecasts for 3.3%.

Investors were particularly encouraged by the latest inflation reading since data released on Tuesday showed that U.S. producer prices increased moderately in December.

Following the U.S. consumer price inflation data, traders are now pricing in two Fed rate reductions in 2025, compared to one following stronger labor market figures last week, according to the CME FedWatch Tool.

As of 10:22 am IST, Bitcoin was trading at $99,589, up 2.5%, after hitting an intraday high of $100,781. Meanwhile, Ethereum surged 4.5% to $3,370.

“Bitcoin extended its recovery, reaching a high of $100,860 and currently challenging the critical resistance at $100,000. Risk assets gained momentum after a softer-than-expected Consumer Price Index report boosted market sentiment,” said CoinSwitch Markets Desk.

Edul Patel, CEO of Mudrex, said, “Bitcoin surged past $100k after a week-long consolidation, signalling a strong bullish comeback. The CPI data meeting expectations eased macroeconomic concerns, increasing hopes for dovish Fed policies. Investor confidence grew further with Oklahoma and Texas advancing Bitcoin Reserve proposals.”

“Additionally, institutional participation increased with over $720 million in inflows into Bitcoin ETFs. As Trump’s inauguration approaches, anticipation of crypto-friendly announcements will continue to drive momentum, setting the stage for further market growth,” Edul added.

Also Read: 5 days left for Trump as President: What should crypto investors keep in mind?

Other major altcoins also saw significant gains on Thursday. XRP rose 9.7%, Solana gained 6.4%, and Dogecoin increased by 4.2%. Cardano surged 4%, followed by Tron (5.5%), Avalanche (6.9%), Hedera (11.5%), and Litecoin (16%).

“XRP hit a 7-year high above $3, driven by $3.8 billion in large-scale token accumulation,” said CoinSwitch.

The volume of all stablecoins is now $142.48 billion, which is 91.4% of the total crypto market 24-hour volume, as per data available on CoinMarketCap. Meanwhile, the global crypto market cap saw a 3.2% rise, reaching $3.49 trillion.

In the last 24 hours, the market cap of Bitcoin, the world’s largest cryptocurrency, rose to $1.972 trillion. Bitcoin’s dominance is currently 56.59%, according to CoinMarketCap. BTC volume in the last 24 hours surged 5.2% to $57.86 billion.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)

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