Does This Year’s CPI Figures Stay Crypto on Track to$ 200, 000?

Bitcoin could see a boom toward$ 200, 000 in 2025, experts say, as businesses anticipate important U. S. inflation statistics and institutional money flows drive speed. &nbsp,

Scheduled for release at 8: 30 am ET Wednesday, the December Consumer Price Index ( CPI ) is expected to show a year-over-year increase of 2.9 % and a monthly rise of 0.3 %, according to MarketWatch data.

Core CPI, which excludes food and energy, is projected to grow 0.3 % month-over-month.

Understanding prices trends and how they might affect Federal Reserve monetary policy requires the projected CPI data to be useful. &nbsp,

Lowering or stabilizing inflation could cause the Fed to ease its extreme higher-for-longer interest price policy, creating a risk-on environment favorable for assets like Bitcoin. &nbsp,

If inflation eases in line with expectations, it could boost Bitcoin’s appeal by indicating increased cash in financial markets as a result of probable rate cuts, increasing the appeal of risk assets for administrative and wholesale investors.

Likewise, persistently high inflation had delay financial easing, tempering Bitcoin’s upwards trajectory. Data from the CME FedWatch Tool as of January 15th, 2025, indicates that investors are divided on the Fed’s price cut trend for the year. &nbsp,

” The Producer Price Index came in under desire, albeit still rising, it rose less than expected”, Ryan McMillin, chief investment officer at crypto account director Merkle Tree Capital, told

” We could see the same for CPI on Wednesday. That would indicate that risk assets may experience some respite and the dollar has likely topped out.

This is in line with Trump’s cabinet’s confirmation this year, McMillin said, and his team is making more and more remarks about strategies to diminish the money and lower interest rates, including the 10-year Treasury, which has been rising despite Fed rate increases, McMillin continued.

As the Trump team officially declares its support for bitcoin and blockchain, he said,” That may take a while to calm the capital marketplaces,” he said.

While some people anticipate two to two 25 basis point reductions in keeping with the Fed’s most recent direction, a sizable part of investors then think there might be no price cuts at all in 2025. &nbsp,

New strength in the U. S. labor market, with December’s sudden 256, 000 job gain, has fueled fears about inflation staying above the Fed’s 2 % target, possibly delaying more easing and creating uncertainty for risk resources, including crypto.

A bullish time away?

Despite price cuts, some nevertheless see progress in a final boost this year.

In its latest weekly statement, CryptoQuant highlighted Bitcoin’s ability to walk between$ 145, 000 and$ 249, 000 by year-end, supported by positive economic changes, a pro-crypto U. S. management, and traditional patterns. &nbsp,

The report also points to growing institutional adoption, with addresses holding 100-1, 000 BTC, adding$ 127 billion in 2024.

” Bitcoin is entering the final year of its four-year cycle, historically a period of significant price increases”, CryptoQuant wrote. According to historical trends, capital flows into Bitcoin could top$ 520 billion in 2025, surpassing the$ 40 billion mark since late 2022. &nbsp,

With a 2.3 % market value to realized value ratio, Bitcoin is still well below the 3.8%-4.0 zone, which suggests room for growth. The ratio compares Bitcoin’s market capitalization to its realized capitalization, helping identify overbought or oversold conditions.

Risks include a potential” sell-the-news” event tied to the U. S. administration’s pro-crypto policies and weak retail participation, which could temper momentum. &nbsp,

Meanwhile, Wednesday’s CPI data could heavily influence market sentiment, with deviations from expectations likely to affect the Fed’s rate path and Bitcoin’s trajectory, CryptoQuant cautioned.