Bitcoin Drops 2% on Hotter-Than-Expected U.S. Inflation
Summary
Bitcoin fell below $49,000 due to a higher-than-expected U.S. inflation reading which impacted interest-rate cut expectations. The January Consumer Price Index (CPI) report showed a 3.1% year-on-year inflation, faster than the predicted 2.9%. This led to a decrease in the likelihood of the Federal Reserve cutting interest rates in May, from 52% to 34%. This also affected traditional markets, with the 10-year U.S. Treasury bond yield increasing by 12 basis points and the S&P 500 equity gauge and the Nasdaq Composite Index declining by up to 2%.
