The recently released US January CPI data has some points of interest. Core CPI increased by 2.6% year-on-year, which is lower than the market’s original expectation of 2.7%, making it a bit of a surprise. The overall CPI is also 2.7% year-on-year, in line with expectations.

For the crypto market, inflation data is often a key indicator. A core CPI below expectations suggests that price pressures have eased somewhat more than anticipated, which usually benefits risk asset sentiment. Although the difference is only 0.1 percentage points, in macroeconomic data, every decimal point can trigger traders to reconsider.

In the short term, this data may influence the Federal Reserve’s future policy expectations, thereby affecting the volatility of the entire crypto market. It is worth continuing to monitor the development of subsequent economic data.