Bitcoin Price Stalls. Why Inflation Data Matters for Crypto. — Barrons.com

By Elsa OhlenBitcoin rose modestly early Wednesday as investors await the latest U.S. inflation reading.The world's largest cryptocurrency traded largely flat over the last 24 hours to $96,910, according to CoinDesk data. It's up more than 40% since Nov. 5 when President-elect Donald Trump won a second term in the White House, promising a more friendly regulatory regime for digital currencies.The crypto rally has been somewhat hampered over the past month as investors fret over the risk of the Federal Reserve keeping interest rates higher for longer.The Bureau of Labor Statistics is set to release the December consumer price index (CPI) on Wednesday at 8:30 a.m. Eastern time — and economic forecasters expect inflation to have picked up. If they are right, that could push the Fed to slow down or even reverse its rate-cutting program.The price of cryptocurrencies typically suffer when interest rates are high as investors tend to prefer safe haven investments rather than riskier investments such as crypto.Among other digital coins, XRP jumped 8.8% on hopes of a positive development in the legal case between the Securities and Exchange Commission and Ripple. Ripple owns and operates the payment platform on which XRP is used.Ether and Solana traded down less than 1%, respectively, while Dogecoin rose 0.6%.Write to Elsa Ohlen at [email protected] content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.