On Wednesday, the price of Bitcoin dropped below $69,000 before the release of U.S. inflation data.
The biggest digital asset by market capitalization was trading for $68,966, having dropped by about 2.40% over the previous day, as per the CoinMarketCap. The GM 30 Index, which represents a collection of the top 30 cryptocurrencies, has fallen by 2.97% to 146.95 in the past 24 hours.
Later today, the U.S. Bureau of Labor Statistics is scheduled to release the Consumer Price Index (CPI) data for March 2024. It is anticipated that inflation will increase in March at an annual rate of 3.4%, which will be higher than the 3.2% increase seen in February.
On the other hand, the possibility of a rate cut by the US Federal Reserve in the first half of 2024 may be affected if the data indicates a soft inflation reading for March.
Interest rate traders are 93.9% certain that the Fed will keep rates unchanged in May, according to the CME’s FedWatch tool. The market now projects a 50.8% chance of a rate cut at the Federal Open Market Committee meeting in June.
In advance of the crucial U.S. inflation data on Wednesday morning, stock futures saw a small increase. Early morning trading saw a 44-point increase in futures linked to the Dow Jones Industrial Average, or 0.1% higher.
Bitcoin usually follows the trends of indices like the S&P 500 and Nasdaq. However, in the past day, it has shown a different performance despite the S&P 500 closing slightly higher and the Nasdaq increasing by 0.32%.
The U.S. Labor Department released employment data for March last Friday, which precedes the inflation reading. According to the data, American employers increased employment by 03,000, exceeding forecasts and indicating that the labor market is still robust even in the face of rising interest rates.
Low unemployment and robust job growth can drive wages and prices higher, possibly leading to inflation. In response, the Fed might opt to maintain interest rates to prevent economic overheating.
Also Read: Bitcoin Price Surges to $72k Ahead of Halving Event
