After yesterday’s CPI report revealed continued inflation woes, leading cryptocurrencies Bitcoin and Ethereum followed the markets’ comeback.
Bitcoin and Ethereum had regained all of their losses from yesterday when they plummeted in response to the announcement of the US Bureau of Labor Statistics consumer price index (CPI), which was 8.2% higher than the previous year’s figures.
According to CoinGecko, the top cryptocurrency is trading at roughly £17478.67, up as much as 3.4% from yesterday’s low of £16321.08. Despite today’s gains, Bitcoin remains around year lows, down 71.5% from its November 2021 high of £61417.74.
At press time, Ethereum, the second-largest cryptocurrency by market value, had more than recovered yesterday’s losses and was trading at £1175.98, up 3.7% in the previous 24 hours. However, it is still much lower than its year-high of £4339.20, according to CoinGecko.
The Dow Jones Industrial Average and the S&P 500 have rebounded more than 2.5% since yesterday, wiping off a week’s losses. They are now at 30,038.72 and 3,669.91 points, respectively.
Bitcoin and Ethereum, as well as the majority of other cryptocurrencies, tend to follow the equity market’s negative fluctuations as investors seek safe havens such as the US dollar to avoid “risky” assets. According to new figures issued in the CPI report yesterday, inflation for US goods and services was 8.2% year on year.
The index measures the rate of change in prices for products such as fuel, used automobiles, clothing, and other items, and it aids in tracking overall inflation. According to the study, the index gained 0.4 % on a seasonally adjusted basis in September after climbing 1 % in August.
Almost everything has risen in price except gasoline, which has fallen 4.9% since August. Because of the high inflation rate, the Federal Reserve is expected to keep hiking interest rates to control inflation, which is now at a 40-year high in the United States.