U.S. inflation soared in April, but Bitcoin held strong at the $80,000 mark

The U.S. April CPI data reached a three-year high, raising concerns in the market about the Federal Reserve's potential rate hikes. Both the U.S. stock market and bond market came under pressure, but Bitcoin performed relatively well. Data shows that the core CPI in the U.S. rose by 0.4% month-on-month in April, higher than the market expectation of 0.3%, and increased to 2.8% year-on-year; the overall CPI, which includes energy prices, rose by 3.8% year-on-year, up from the previous value of 3.3%, marking the highest inflation level since May 2023.

As a result of the data, the market quickly adjusted its expectations for the Federal Reserve's policy path. CME FedWatch data shows that traders are currently betting on a probability of over 35% for at least one rate hike within 2026, whereas just a few weeks ago, the mainstream market expectation was still for a rate cut within the year. Risk assets subsequently fell, with the Nasdaq index dropping over 1.3% and U.S. Treasury yields rising in tandem. However, the cryptocurrency market showed some resilience. Bitcoin remained above $80,000 after the data was released, currently reported at around $80,500, essentially flat over the past 24 hours; Ethereum and XRP fell by about 2.5%.