The latest data on inflation in the U.S. has shown a slight easing in the monthly pace, with the Consumer Price Index (CPI) rising 0.3% in April compared to 0.4% in March. The report also revealed small declines in line with expectations, with CPI higher by 3.4% on a year-over-year basis.
One interesting development following the release of the report was the price of bitcoin (BTC) jumping more than 1% to $63,700. This increase comes after a period of pressure on bitcoin’s price due to expectations of higher interest rates.
The unexpected rise in inflation this year has caught many, including the U.S. Federal Reserve, off guard. The growing economy and higher inflation have dampened hopes of any imminent central bank rate cuts. Prior to the CPI report, the odds of a summer rate cut were low, with traders only pricing in a 50% chance of a move in September.
In addition to the inflation numbers, retail sales data for April showed a flat reading, missing forecasts for a rise of 0.4%. Retail sales excluding autos also saw a smaller increase in April compared to March.
Despite the mixed economic data, traditional markets reacted positively, with S&P 500 futures rising 0.5% and the 10-year Treasury yield sliding. The U.S. dollar index dropped, while gold saw an increase in value.
Overall, the latest inflation and economic data have provided some insights into the current state of the U.S. economy and its impact on various asset classes. Investors will be closely watching for further developments in the coming months.