Fearing that inflation of more than 5% will continue, Bitcoin jumped to $49,000


Bitcoin (Bitcoin) Rose slightly on September 18, because after the inflation data fell last Tuesday, the focus shifted to the Federal Open Market Committee (FOMC) policy meeting.

The BTC/USD exchange rate on the Coinbase exchange was close to 49,000 U.S. dollars, hitting 48,825 U.S. dollars, and then lowered due to mid-term profit-taking sentiment. Nonetheless, the upward move has raised expectations that the currency pair will hit the psychological resistance target of $50,000 in the next few trading days.

Inflation concerns boost Bitcoin demand

Despite the weakening of the Consumer Price Index (CPI) report released on September 13, the Bitcoin market has been boosted due to concerns about rising inflation.

Data show that the CPI in the United States rose 5.3% year-on-year in August from 5.4% last month.The market reacted to these numbers mixedly, some cheer Core inflation is lower than expected, while others Pointing Inflation is still at an ridiculously high level-5.3% is one of the highest CPI figures in more than a decade.

“I like to look at inflation data from a median point of view (so, instead of letting a crazy category drive it, we focus more on the center of the distribution, spanning 82 categories with the same weight),” said data founder Jens Nordvig of analytics company Exante Data. He added:

“exist [median] Metric system, [inflation] The number is not low. “

More Bitcoin bullish clues emerge from TD Securities analysts famous After the inflation report is weaker than expected, the Fed may postpone its plan to reduce its monthly asset purchase policy by US$120 billion.

In addition, Pomp Investments partner Anthony “Pomp” Pompliano warned that a sustained 5% inflation would make Americans watch their savings evaporate.

“The only way to protect yourself in this environment is to make sure you get the investment,” Pomp In the instructions to the customer, it says.

“The more you invest in the market, whether it’s stocks, real estate, cryptocurrency, etc., the better you will become.”

U.S. dollar rises simultaneously

As it happens, the BTC/USD exchange rate Skipped The inflation data was 4.85% on the day it was announced.

The currency pair rose another 2.17% on Wednesday, and its price closed above US$48,000. In the next two trading days, its price began to trade sideways, only to further rise to $49,000 on Saturday.

Surprisingly, the dollar index (DXY) also Move higher Just like Bitcoin, after the inflation report was released, macro investors shifted capital to assets that they considered safe-haven assets. The index, which measures the exchange rate of the U.S. dollar against a basket of major foreign currencies, rose 0.41% on Friday to 93.246, the highest level in September.

After a mixed inflation outlook, the Bitcoin and U.S. dollar indexes rose. Source: TradingView.com

It is expected that the FOMC meeting next week will provide more clues to the Bitcoin and U.S. dollar markets.

related: After the “most confusing” Jerome Powell press conference, Bitcoin struggled at $40,000

Fed officials agreed that they will begin to loosen loose monetary policy before the end of this year. But the non-agricultural employment report earlier this month showed that the US labor market has not yet fully recovered.

This will prompt the Fed to maintain its reduction plan, and any further delay may lead to a stronger Bitcoin and a weaker U.S. dollar.

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