Bitcoin Hits $116k Despite CPI Disappointment

TL;DR

• BTC has hit the $116k level, up by nearly 4% since the start of the week.

• The positive performance comes despite the disappointing CPI data released in the United States.

BTC Hits $116k, CPI Disappoints

Bitcoin, the leading cryptocurrency by market cap, briefly touched the $116k level on Friday after adding 1% to its value. The coin has now slightly retraced and is trading at $115,219.

The positive performance comes despite disappointing CPI data from the United States. U.S. inflation for August came in hotter than expected. According to the Bureau of Labor Statistics (BLS), the Consumer Price Index (CPI) rose 0.4% in August, higher than the 0.3% expected by analysts and 0.2% recorded in July. On a year-over-year basis, the CPI was higher by 2.9%, in line with the forecast of 2.9% and 2.7% in July.

The Core CPI, which excludes the volatile food and energy components, rose 0.3% in August, matching forecasts and July's 0.3% increase. Year-over-year core CPI rose 3.1% compared with the 3.1% forecast and July’s 3.1%.

The news briefly saw Bitcoin drop below $114k, but it has since bounced back to hit the $116k mark. Despite the disappointing inflation figures, analysts believe that it would not derail the Fed’s plan to cut interest rates next week. Analysts expect the Fed to cut the interest rate by at least 25 basis points next week, a move that could send Bitcoin and other risk-based assets rallying.

Altcoins Rally Higher

With Bitcoin hitting the $116k level, altcoins have also been rallying. Ether, the second-largest cryptocurrency by market cap, has reclaimed the $4,500 mark after adding 2% to its value. 

Ripple’s XRP is also trading above $3 once again, while Solana’s SOL is targeting the $250 mark as it is up 15% since the start of the week. Thanks to this latest rally, the total cryptocurrency market cap is now above $4 trillion once again.