U.S. Inflation Remains above 5%, Bitcoin Retracing from $50k
U.S. Consumer Price Index (CPI) stood at 5.3 percent year-to-date, down from 5.4 percent in September, data last week revealed. At the back of this announcement, Bitcoin prices inched closer towards $50k before retracing over the weekend to spot rates. Meanwhile, the USD printed higher despite concerns from investors.
The U.S. inflation is way above the two percent mark at over five percent, which was received differently. Some investors are concerned inflation is at a ridiculously high level. At the same time, on the other corner, some optimists think inflation will tone down over time. They hold that the contraction from 5.4 to 5.3 percent is worth celebrating.
While the U.S. FED is confident that the high inflation they expect will persist for the better part of 2021 is transitory, pessimists are drumming for a better alternative as a store of value. Last year, as part of COVID-19 containment, trillions of dollars, including helicopter money, were printed. With money printers on overdrive, Bitcoin maximalists believed the coin would be kept afloat by high inflation.
This is what traders find themselves in, and Bitcoin is remaining relatively firmer, below $50k. Traders are confident that as long as inflation remains higher, above five percent, BTC will be supported, even pumping prices towards all-time highs of $64k.