Bitcoin (BTC) posted strong gains on Wednesday, May 12, rising to the $66,400 mark. This followed the release of April's U.S. Consumer Price Index (CPI) data, which pointed to easing inflationary pressures.
According to the U. S. Bureau of Labor Statistics, the annual CPI in April amounted to 3.4%, which is slightly lower than the March figure of 3.5%. The core CPI, which excludes the volatile food and energy categories, showed a similar trend: it fell from 3.8% to 3.6%. Both indicators were in line with market forecasts, showing a monthly growth of 0.3%.
This data was a positive signal for the market, as previous CPI reports had pointed to more persistent inflation, which could have delayed the Federal Reserve's interest rate cut. Amid weakening inflation, investors now expect there is a 75% chance of a rate cut in September, according to the CME FedWatch Tool.
The published inflation data had a direct impact on bitcoin's momentum. The #cryptocurrency broke the $63,000 mark and continued its rally, trading at $65,900 at the time of writing, representing a rise of nearly 7% in the last 24 hours, according to CoinGecko data.
Bitcoin's rise has also had a positive impact on the overall cryptocurrency market, which rose nearly 6% to $2.5 trillion. Major #altcoins including #ETFvsBTC (ETH) and Solana (SOL) performed well: #ETFvsBTC crossed the $3,000 mark, up 4%, while SOL climbed above $150, posting an 8% gain.
Technical analyst Rekt Capital noted in a recent post that #bitcoin may have exited the "danger zone" after the halving - the period that follows a bitcoin halving event. The analyst suggests that bitcoin is currently in an accumulation phase. In addition, if historical patterns continue, the next bitcoin bull market peak could occur between mid-September and mid-October 2025.
Thus, recent market developments, including the easing of inflationary pressures and the positive performance of bitcoin and altcoins, point to a potential recovery in the cryptocurrency market and increase optimism among investors.
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