Alex Dovnya
Bitcoin (BTC) price soars above $64,000 for the first time since May 6th
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The price of Bitcoin (BTC), a representative virtual currency, is topped with The $64,000 level earlier this Wednesday.
This comes after the latest consumer price index (CPI) released by the US Department of Labor on the same day fell to 3.4% compared to the previous year. This is in line with analyst expectations and explains why the price of the largest cryptocurrency has increased significantly. That said, a lower CPI reading likely would have caused a stronger price spike.
Rent and gasoline are now the main drivers of inflation, contributing more than 70% of inflation in April.
Index swap traders are now leaning toward accelerating the pace of rate cuts following the latest CPI data. The Fed is expected to lower borrowing costs in September and December.
Of course, loosening monetary policy will have a positive impact on risk assets like Bitcoin. Last month, as U.Today reported, the largest cryptocurrency experienced a significant drop after it turned out that US inflation was higher than expected. JPMorgan President Jamie Dimon has argued that the state of the US economy is reminiscent of the 1970s, when Bitcoin prices began to fall due to growing stagflation concerns.
But Federal Reserve Chairman Jerome Powell quickly dismissed these stagflation concerns, instilling some confidence in the market.
U.S. stock futures also soared on the inflation data, with S&P 500 futures up 26 points.
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Alex Dovnya
