Markets: Bitcoin, Ether prices rise as November U.S. inflation reading lower than expected

Bitcoin and Ether both rose more than 3% in Wednesday morning trading in Asia, as the U.S. consumer price index (CPI) announced overnight came in lower than expected, raising expectations the Federal Reserve will ease back on raising interest rates to curb inflation. Most of the top 10 non-stablecoin cryptocurrencies rose.

Fast facts

• Bitcoin rose 3.34% to US$17,789 in the 24 hours to 8 a.m. in Hong Kong, while Ether gained 3.61% to US$1,321, according to CoinMarketCap data.
• Solana was the biggest gainer among the CoinMarketCap top ten tokens by market capitalization, adding 4% to US$13.87.
• BNB, the native token of crypto exchange Binance Global Inc., was the only loser on the top ten list, dipping 1.55% to US$272. BNB has fallen more than 9% this month amid reports that a review of Binance’s assets may have raised red flags and that the crypto exchange, the world’s biggest, is under investigation by the U.S. Justice Department.
• The Binance exchange saw almost US$2 billion in withdrawals over 24 hours, blockchain analytics company Nansen said on Tuesday, according to a Reuters report.
• Global cryptocurrency trading volume surged 46.31% over the last 24 hours to US$53.4 billion. The market capitalization gained 2.21% to US$869.7 billion.
• U.S. equities jumped on the lower inflation reading, but gave up most gains later in the day to finish just slightly higher on Tuesday. The Nasdaq Composite Index rose 1% and the S&P 500 Index added 0.73%. The Dow Jones Industrial Average gained 0.3%.
• The U.S. CPI – released by the U.S. Bureau of Labor Statistics and a key inflation indicator – was up 7.1% in November compared to last year, but less than the 7.3% forecast by Trading Economics. The CPI has shown a steady decline from 7.7% in October and 8.2% in September.
• The U.S. Federal Reserve is likely to increase interest rates by 50 basis points at its meeting on Wednesday, according to consensus estimates, which would be an easing back from the 75 basis point increases in the past four consecutive meetings.
• The Fed has increased interest rates since March to slow inflation, raising from nearly zero to a 15-year high of 3.75% to 4%, and has signaled that rates may end up exceeding 5%.