Within minutes of reports showing U.S. consumer prices rising and weekly wages falling, cryptocurrency prices surged on inflation fears. Bitcoin prices briefly topped US$69,000 shortly after 9 a.m. ET, according to Coingecko.
- The U.S. Bureau of Labor Statistics released two reports Wednesday morning. The first showed the consumer price index rising 6.2% for the 12 months ending October, faster than any 12-month period since 1990. A separate real-earnings report showed a 1.6% decrease in real average weekly earnings over the same period.
- Less than one month ago, Bitcoin peaked at US$67,043, according to Coingecko, the day after the successful introduction of the first U.S. Bitcoin futures exchange-traded fund.
- Recent price fluctuations in Bitcoin and changes in energy markets have economists analyzing Bitcoin’s growing role as an inflation hedge.
- In August, Chairman Jerome Powell of the U.S. Federal Reserve announced a major policy change that would allow inflation more room to rise before the Fed defensively raises interest rates.