Bitcoin gained 5% after the U.S. Bureau of Labor Statistics reported that the consumer price index (CPI), a key inflation indicator, rose 0.4% in October from September. CPI was up 7.7% from a year earlier, less than the expected 7.9%, and down from 8.2% in September. October’s CPI recorded the smallest 12-month increase since January. 

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Fast facts

  • Bitcoin recovered from as low as US$15,682 in the last 24 hours to trade at US$17,589 at 10:00 p.m. Hong Kong time, according to CoinMarketCap data. The largest cryptocurrency by market capitalization has been dropping to yearly lows amid the FTX fiasco.
  • All cryptocurrencies in the top 10, excluding stablecoins, were up after the CPI data was released, according to CoinMarketCap data.
  • Equity markets also reacted positively to the October inflation report, which hinted the U.S. Federal Reserve may slow down its pace of interest rate hikes. The S&P 500 opened 3.42% higher on Thursday than the previous close while Nasdaq Composite opened 4.39% higher.
  • “Despite the positive data, the Fed will keep its foot on the brake of the U.S. economy for the time being, meaning a fifth consecutive 50 basis-point increase in interest rates is possible, if not likely, next month,” Nigel Green, chief executive of financial advisory firm deVere Group, said in a statement shared with Forkast.
  • The core CPI, which excludes energy and food prices, rose 6.3% over the last 12 months, retreating from a four-decade high in September.

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