- The U.S. Consumer Price Index (CPI) rose 0.3% month-over-month in December, reaching % year-over-year.
- Core CPI held steady at % month-over-month and % year-over-year, supporting the view of a rate hold at the January6 FOMC meeting.
- Bitcoin (BTC) maintained its price near $92,177 following the CPI release.
- CME FedWatch odds indicated a high probability (over 70%) of no change in interest rates.
- Deribit’s DVOL (Deribit Volatility Index) remained subdued, reflecting market stability.
U.S. CPI Release and Its Impact on Bitcoin
The latest U.S. Consumer Price Index (CPI) data showed a 0.3% increase month-over-month in December, bringing the year-over-year figure to 2.7%. This modest rise was largely attributed to a 0.4% increase in shelter costs. The core CPI, which excludes volatile food and energy prices, held steady at 0.2% month-over-month and 2.6% year-over-year. These numbers align with expectations and support the view that the Federal Reserve might hold interest rates steady at its upcoming January Federal Open Market Committee (FOMC) meeting.
Bitcoin’s Reaction and Market Sentiment
Following the CPI release, Bitcoin (BTC) traded near $92,177, showing resilience in the face of the economic data. The CME FedWatch tool, which provides probability estimates for future Fed actions, indicated that the odds of a rate hold were firmly in the high-70% range. This suggests that the market is pricing in a high likelihood of the Fed maintaining current interest rates, at least for the time being. Additionally, Deribit’s DVOL, a measure of market volatility, remained subdued. This stability in volatility metrics further indicates that the market is not anticipating significant changes or surprises from the upcoming FOMC meeting.
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