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In a Nutshell
U.S. April Inflation Increases by 2.3%, Stagnant Bitcoin Market Persists
Bitcoin stayed put following the release of April's inflation figures, which indicated a marginal 0.2% rise in prices, while the annual inflation rate decreased to 2.3%. Meanwhile, the Federal Reserve opted to keep interest rates at 4.25%-4.50% amid uncertainties caused by Trump's tariff policies.
The Sweet and Sour of Bitcoin
After witnessing a surge of over 10% last week, Bitcoin was trading around $103,798 earlier today, dipping 0.3% from its previous level, according to CoinGecko data. Ethereum edged up by 0.5%, Solana dropped a minuscule 0.1%, while Dogecoin and Shiba Inu remained steady.
Reality Check: A Surprise Trade Deal and Its Tiny Impact on Bitcoin
On May 12, the U.S. and China reached an unexpected truce, halving tariffs for a 90-day period. This move gave the equities markets a boost, but the impact on Bitcoin was minimal. Treasury Secretary Scott Bessent is expected to meet with Chinese officials this week to discuss further developments.
Art of the Steal: A Game of Tariffs Among Giants
China reduced its tariffs from 145% to 10%, undoing a fraction of the hikes announced by President Trump. In response, the U.S. rolled back import levies from 125% to 30%. Despite initial market optimism, the macro picture remains uncertain, with markets showing a mere 15% chance of a June rate cut, down from 34% earlier this month.
The Wall Street Whisperer Weighs In
Arthur Azizov, founder of B2 Ventures, believes that if core CPI jumps above 2.9%, a sharp drop might occur, driving Bitcoin's value toward $100K. However, Azizov also warns against interpreting Bitcoin's resilience as a sign of complacency, stating that the asset has evolved to behave more as a macro instrument rather than a purely speculative trade.
The Light at the End of the Tunnel
Aurelie Barthere, Principal Analyst at Nansen, argues that April's influx of risk appetite, driven by the U.S.-China reset and robust labor data, is vital to consider in addition to inflation data. According to Barthere, unless core CPI surges above 2.9%, a significant reversal in crypto markets is unlikely.
Edited by Stacy Elliott.
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- The cryptocurrency market saw Bitcoin holding steady after the release of April's inflation figures, while Ethereum edged up slightly. Other altcoins like Solana, Dogecoin, and Shiba Inu experienced varied movements.
- The Federal Reserve decided to maintain interest rates following uncertainties caused by Trump's tariff policies, with Bitcoin showing minimal reaction to the news.
- In a surprising turn of events, the U.S. and China reached a truce on May 12, reduce tariffs for a 90-day period, but the overall impact on Bitcoin was negligible.
- Arthur Azizov, founder of B2 Ventures, suggests that a surge in core CPI above 2.9% might drive Bitcoin's value towards $100K, but warns against interpreting Bitcoin's resilience as a sign of complacency.
- Aurelie Barthere, Principal Analyst at Nansen, believes that the influx of risk appetite in April, caused by the U.S.-China reset and strong labor data, plays a crucial role in the crypto market, along with inflation data.
- Core CPI surging above 2.9% might result in a significant reversal in the crypto markets, according to Principal Analyst Aurelie Barthere, as she suggests considering the U.S.-China reset and robust labor data alongside inflation data for a comprehensive understanding of the market trends.
