The US inflation data have injected new optimism in the Bitcoin market and wider cryptocurrency markets. In January, the Personal Consumption Expenditures (PCE) inflation—the Federal Reserve’s preferred measure—fell to 2.5%, precisely in line with expectations. In January, core PCE inflation, which is the Federal Reserve’s preferred measure, was 2.6%. It also matched forecasts.
Bitcoins and Altcoins are Seeing Relief on Inflation data
Latest News data The performance is stable both month over month and year to date. Headline PCE remained at 2.5% YoY, while core PCE—revised from a previous 2.8% (and even 2.9% in earlier revisions) to 2.6%—represents a 30 basis point improvement. It’s the lowest headline PCE reading YoY for the core since August 2024. This is the first decline in headline PCE in the last four months. The figures indicate that the market’s sentiment may be changing as inflationary pressures ease.
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He noted that the bullish data was highlighted by BACH. He pointed out that “this core headline number is the lowest reading YoY since August 2024” The 30bp reduction was cited as an important improvement. Although he cautioned against over-optimism, he said: “This is a BIG difference and is in fact bullish for markets! We may still see some choppy bottoming formation, but this bull ain’t over! – Credit spreads despite all this remain narrow, which is a sign that credit markets see no risk!”
Bitcoin has recovered to above $84,000 following the data’s release. It is up about 7% from its current low, $78,258. Bitcoin has been a major player in the cryptocurrency market for the past week. suffered an 18% declineAfter losing $96,000 the rebound represents a clearly recovered. Altcoins also saw a similar boost; Ethereum climbed by 5.8%, XRP jumped 9.2% and Solana soared by 16%.
SOL has been rallying in recent days, and this coincides with CME Group’s announcement that they will be launching Solana (SOL), futures contracts on 17 March pending CFTC approval.
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Kevin Capital, a Crypto Analyst (@Kev_Capital_TA), also weighed The PCE was released, and the release has implications. “Fed CME interest rate Futures at the current moment has increased to 53.7% probability of a rate cut in June after the PCE Report. Up from below 50%. That’s solid news. #BTC #Altcoins #Crypto”
Broader Macro Perspective
The market could benefit from broader macroeconomic data beyond PCE. Julien Bittel shared the views of Global Macro Investor’s Head Macro Research, Julien Bittel. He attributes The current volatility of the crypto market is a concern tightening of financial conditions In Q4 last year, this drained liquid and dampened economic surprises.
Bittel implies that the conditions have reversed: “Financial conditions have been easing rapidly over the past two months – dollar down, bond yields down, oil down – and that’s setting the stage for a recovery in the data soon.” He further notes that Bitcoin’s price now fully reflects the effects of recent tightening, and with an RSI at 23—the most oversold level since August 2023—he advised, “be greedy when others are fearful.”
BTC was trading at $83,804 as of press time.
Charts from TradingView.com and Shutterstock.
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Source: www.newsbtc.com
