The crypto market has seen a significant boost, with Bitcoin (BTC) surging above $100K on Wednesday following the release of the US November Consumer Price Index (CPI) data. 📊 The data, which came in line with expectations at 2.7%, has led market participants to anticipate a 25 basis points (bps) interest rate cut by the Federal Reserve (Fed) next week. 📈
📊 US CPI Data Aligns with Expectations
The US CPI data for November rose to 2.7% YoY from 2.6% in October, in-line with market expectations. 📊 Monthly CPI rose 0.3% in November, slightly higher than 0.2% in the previous month. Notably, core CPI stood at 3.3%, unchanged from the rise in October. 📊
📈 Market Reaction
The CPI data has led to a significant boost in the crypto market, with Bitcoin surging 6% above $100K on Wednesday. 🚀 The top altcoins leading the rally include XRP, Solana (SOL) and Cardano (ADA), which have seen gains of 23%, 11% and 16%, respectively. 📈
📊 Other Sectors Respond Well to Inflation Data
Several meme coins, including Dogecoin (DOGE), Shiba Inu (SHIB), dogwifhat (WIF), BONK and FLOKI, saw double-digit gains. 🤯 Likewise, the artificial intelligence token sector jumped over 7%, with top AI tokens rising over 10%. 🤖
📊 Caution Advised
However, despite the immediate signs of a crypto rally following the CPI data, James Toledano, the COO of Unity Wallet, warned that investors should tread with caution when dealing with assets like Bitcoin, based on its volatile history. 📊
"Bitcoin has a history of extreme volatility, and that calls for caution because corrections always come," Toledano told FXStreet. "The pendulum swings both ways and for new entrants to Bitcoin, I'd caution going all-in when the price is at an all-time six-figure high, especially when the latest sugar hit is largely based on sentiment towards the incoming US administration." 📊$DIA
🤔 What do you think? Share your theories and speculations in the comments below! 💬