Bitcoin Rises As U.S Inflation Reaches The Highest

The global pandemic that started towards the end of 2019 has had an impact on the entire world, and each and every industry was affected by it. Many of the countries are still recovering from the aftermath of COVID-19, the U.S. included. Although the country has been able to recover in the last year, the economy still suffers the consequences of the pandemic. In December 2021, the U.S. saw the highest inflation rate in 40 years, with the prices of goods and products rising up to 7% compared to December 2020. December 2021 has been marked as the seventh consecutive month in which inflation has exceeded 5%.

The inflation has been characterized by the U.S. government as a transitory phase resulting from the disruptions in supply chain that the pandemic caused. Not only this, the consumer price index rose to 0.5% in December compared with November, and 7% compared with December 2020. The prices for housing went up to 0.4%, and those of used cars exceeded 3.5% compared to November. But this isn’t what I aim to focus on.

With the release of the inflation numbers, the cryptocurrency has also gone up. Bitcoin moved from USD 43,400 up to USD 43,900 in just a few minutes, with its daily gains increasing over 5%.  Ethereum has also jumped up to USD 3,375 with its daily gains surpassing 8%. The analysts, although, have conflicting opinions about the coinmarket. While the analyst at GlobalBlock, Marcus Sotiriou, claims that there may be a “sell-off at the cryptomarket” if the inflation numbers are higher, he also disagrees with the on-chain data by stating that it suggests a hint of probable cryptoboost with the investment opportunities, which might not be the case.