Bitcoin Price Breaking $26,000 After US CPI Release
- Bitcoin reached a price of over $26,000.
- CPI rose 6.0% in the 12 months leading up to February, meeting the expectations of economists. This index tracks price movements across a wide range of goods and services.
Bitcoin reached a price of over $26,000, which hasn’t been seen since last summer, thanks to the latest Consumer Price Index (CPI) report that showed inflation in the US is still a significant issue.
According to the Bureau of Labor Statistics (BLS), the CPI rose 6.0% in the 12 months leading up to February, meeting the expectations of economists. This index tracks price movements across a wide range of goods and services. Ethereum and Bitcoin also saw significant gains, with a 5% and 4% increase respectively, while other tokens like Dogecoin and Solana also rose.
Although inflation has shown signs of easing since hitting a 41-year high of 9.1% last June, it is still far above the Federal Reserve’s target of 2%. On a month-to-month basis, prices rose 0.4% in February from January, with food, recreation services, and shelter accounting for 70% of the monthly increase to CPI. Shelter prices, in particular, rose 0.8% from January to February, an 8.1% increase from a year ago, while energy prices fell 0.6% month-to-month.
To combat inflation, the Fed has increased interest rates aggressively, making it more expensive for businesses and consumers to borrow and thus cooling the economy. The Fed has taken interest rates to a target range of 4.50% to 4.75%, the highest since October 2007, after lifting interest rates from near zero last March. Last December, the Fed projected that interest rates would rise as high as 5.1% this year. Fed Chairman Jerome Powell also recently said that rates would likely have to go higher due to stronger-than-expected economic data.
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