Bitcoin breaks $24,000 after Fed says ‘disinflationary process’ started in U.S.

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Bit­coin rose above US$24,000 for the first time since mid-August in Thurs­day morn­ing trad­ing in Asia before slid­ing back slight­ly. It gained along with Ether and most oth­er top 10 non-sta­ble­coin cryp­tocur­ren­cies after the U.S. Fed­er­al Reserve raised inter­est rates by the expect­ed 25 basis points overnight and Fed chair Jerome Pow­ell said the “dis­in­fla­tion­ary process” has start­ed in the econ­o­my. U.S. equi­ties gained on the com­ments, also encour­aged by a bet­ter-than-expect­ed growth fore­cast at social media plat­form Meta Plat­forms Inc. Doge­coin was the only token in the top 10 to fall, but it held gains for the week.

See relat­ed arti­cle: Bank­rupt FTX held US$1.4B in cash at the end of 2022

Fast facts

  • Bit­coin rose 3.7% to US$23,979 in the 24 hours to 10 a.m. in Hong Kong, bring­ing its gains to 3.5% in the past sev­en days. Ether added 5.6% to US$1,677 and is up 3.6% for the week, accord­ing to data from Coin­Mar­ket­Cap.
  • Poly­gon jumped 10.9% to US$1.23, gain­ing the most in CoinMarketCap’s list and bring­ing its week­ly gains to 23.2%. Solana added 6.3% to US$25.38, a week­ly rise of 2.4%.
  • Doge­coin lost 0.2% to US$0.09 but was still trad­ing up 9.7% over the past week on reports Elon Musk, the Twit­ter Inc. boss and Doge­coin advo­cate, was con­sid­er­ing bring­ing pay­ment sys­tems to the social media network.
  • The cryp­to mar­ket cap rose 3.7% to US$1.09 tril­lion, with total trad­ing vol­ume up 28.9% to US$60.8 billion.
  • U.S. equi­ties rose on Wednes­day. The S&P 500 Index added 1.1%, the tech-heavy Nas­daq Com­pos­ite Index gained 2% and the Dow Jones Indus­tri­al Aver­age closed up less than 0.1%.
  • Powell’s announce­ment that the Fed was rais­ing inter­est rates by 25 basis points – the small­est increase since March last year – had been priced into mar­kets and reflect­ed eco­nom­ic data in recent months that showed infla­tion had begun to cool. 
  • Labor costs are slow­ing with the Employ­ment Cost Index released Tues­day adding 1.0% last quar­ter, the small­est gain since the end of 2021. In Decem­ber, the U.S. con­sumer price index rose 6.5% year-on-year, well below the 7.1% in Novem­ber and the largest month­ly decline since April 2020.
  • How­ev­er, Fed offi­cials on Wednes­day said they did not think they had fin­ished rais­ing rates entire­ly, and have indi­cat­ed before that they could raise rates as high as 5%. Inter­est rates are cur­rent­ly at 4.5% to 4.75%, the high­est lev­el in 15 years.
  • Tech-giant Meta’s share price rose 2.8% to $153.12. in after-hours trad­ing on Wednes­day after it said it had reached 2 bil­lion users for the first time and pro­ject­ed strong growth into 2023. The company’s Q4 rev­enue came in at US$32.17 bil­lion, down from US$33.67 bil­lion a year ago.
  • Tech­nol­o­gy com­pa­nies have been slash­ing jobs to reduce costs in recent months and investors await earn­ings on Thurs­day from Apple Inc., Amazon.com Inc., and Alpha­bet Inc., the par­ent com­pa­ny of search engine Google.
  • U.S. non-farm pay­roll data is also out on Fri­day, anoth­er key infla­tion indicator.

See relat­ed arti­cle: Cardano’s Djed sta­ble­coin locks US$10 mln in reserves on its first day

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