Bitcoin (BTC) Price Surges Past $100,000 as Risk Rally Renews, Tracks Best CPI Day on Wall Street Since At Least 2023

After demand for risky assets, from cryptos to stocks, was rekindled by softer-than-expected US inflation, Bitcoin surged beyond $100,000 again on recalibration of Fed rate cut bets.

Bitcoin price crossed $100,000 again on Wednesday as softer-than-expected US inflation data sparked a risk rally, tracking the best CPI day on Wall Street since at least 2023.

Demand for risky assets, from cryptocurrencies to stocks, was reignited by the softer inflation readings, pushing Bitcoin past the key level once more.

The world’s largest cryptocurrency by market capitalization has been hovering between the $90,000 and $100,000 mark for the past four weeks. On Wednesday, the token rose 3.9% to $100,222. It last hit $100,000 on January 7, roughly $8,000 below its December 17 all-time high.

A positive tone was set for digital tokens by the equity market’s reaction to the US inflation figures on Wednesday, with Bitcoin’s correlation with the Nasdaq, a measure of US technology companies, hitting a two-year high.

According to data from Bloomberg, the OG token and the Nasdaq 100 Index have a 30-day correlation coefficient of around 0.70. If the value is 1, the assets are moving in lockstep, and if it is -1, the assets are moving in the inverse tie.

Bitcoin & Nasdaq Are Tied at the Hip

Consumer price increases of 2.9% year-over-year were in line with forecasts, while core inflation came in lower than expected at 0.2% month-over-month, according to the latest US inflation report.

That marked the first step down in the core rate in six months.

Cheaper hotel stays, a smaller advance in medical care services, and relatively tame rent increases helped to restrain the December figure.

Easing inflation helps re-establish the narrative that progress in price pressures has resumed after months of higher prints.

However, Fed members will still need to see a string of moderate readings to be convinced. Bond yields have risen substantially amid sticky inflation and concerns that the Fed eased too quickly late last year.

Policymakers are still expected to hold steady on rates at their meeting later this month.

That’s largely thanks to strong jobs data and other factors from last week.

However, several analysts suggest that the news could set the stage for a Fed rate cut in March.

Before the inflation data, traders had expected another cut only in the second half of the year.

John Williams, president of the Federal Reserve Bank of New York, expressed optimism that inflation will continue to come down but offered no clues on when more cuts could be implemented.

Fresh data suggests continuing success in reducing inflation, according to his Richmond colleague Tom Barkin, who argued that rates should remain conservative. The numbers were used by Chicago Fed President Austan Goolsbee to back his prediction that pricing pressures will ease.

Despite a strong US economy and doubts about the impact of Trump's policies, markets were concerned about the Fed's ability to cut interest rates further.

Concerted Cross-Asset Rally

Stocks and cryptocurrencies both rallied on the softening in the core price index.

The Nasdaq 100 and S&P 500 indices both rose after the inflation report, offering respite to Wall Street and adding to speculation that the Fed will continue cutting rates this year.

The S&P 500 marked its biggest gain since the aftermath of the US election, rising 2% as Wall Street stocks recovered their 2025 losses.

Fears that a 5% rate could be on the horizon were eased as a rally in Treasuries drove 10-year rates down by about 15 basis points.

Energy prices also surged, with a barrel of oil reaching over $80.

The combined cross-asset漲幅 was the highest for a consumer price index day since late 2023, according to data from Bloomberg.

The market’s “fear gauge” — the VIX index — marked its biggest decline this year as risk appetite returned.

Trump Trade For Cryptos?

President-elect Trump will be sworn in on January 20, kicking off an administration focused on reform.

Investors are speculating on his pledge to make the US a world leading crypto hub amid the inflationary impact of tariff and immigration policies.

In the days leading up to the president-elect’s inauguration, expect Trump trade momentum to build.

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