Bitcoin (BTC) price saw a significant pullback, erasing gains from Monday as investors recalibrated their expectations for the Federal Reserve’s monetary policy following the release of January Consumer Price Index (CPI) data.
The flagship crypto was trading at $48,753 as of press time — a notable deviation from its recent upward trajectory. The dip liquidated roughly 80% of the long positions over the past four hours, according to CoinGlass data.
CPI hotter than expected
The CPI report, a crucial inflation gauge, indicated a year-on-year increase of 3.1%, surpassing analysts’ predictions and signaling persistent inflationary pressures in the economy.
The development has notably dampened the prospects for the Fed’s early interest rate cut, with market sentiment shifting towards a more cautious outlook.
Prior to the data release, there was speculative optimism that the Fed might ease its interest rate policy as soon as May, buoyed by previous indicators suggesting a softening i
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