Inflation data cools down and eases pressure, Bitcoin returns to 69K

U.S. January Consumer Price Index (CPI) data shows inflation pressures below expectations, moderately easing market concerns over the Federal Reserve maintaining high interest rates, which in turn drove bond yields lower. The cryptocurrency market experienced a significant rebound after extreme panic, with Bitcoin returning to the 69K level. Coinbase’s diversified revenue performance led to a substantial surge in its stock price. Although the overall U.S. stock market gains were limited by tepid performance from technology giants, market sentiment has shown initial signs of stabilization.

Lower-than-expected inflation data alleviates market tightening fears

The U.S. Bureau of Labor Statistics announced that January CPI increased by 0.2% month-over-month and 2.4% year-over-year, both slightly below market expectations. Core CPI remained relatively stable, with a 2.5% annual increase, in line with consensus. This result indicates that inflation momentum is moderating, reducing concerns about a rebound in inflation and providing more room for the Federal Reserve’s future monetary policy shifts. Following the data release, expectations for rate cuts increased, causing U.S. Treasury yields to fall, providing critical support to the financial markets, which had been volatile this week due to AI transformation concerns.

AI impact and sector rotation, tech giants diverge

Recently, concerns about artificial intelligence (AI) potentially disrupting existing business models have increased, not only dragging down the software industry but also spreading selling pressure to real estate, freight, and financial services. Even with mild CPI data on Friday, the U.S. stock market closed near flat, mainly because the performance of large-cap technology giants was relatively weak, offsetting gains in other sectors. This indicates that investors are currently assessing the actual benefits versus the disruptive potential of AI, leading to capital reallocation across industries and causing market volatility.

Crypto market rebound from lows, Coinbase’s revenue restructuring

After several days of correction, the cryptocurrency market saw a notable rebound, with Bitcoin regaining the 69,000 USD mark and Ethereum climbing back above 2,000 USD. Notably, Coinbase’s stock surged over 16% after earnings were announced, marking the largest single-day gain since 2025. Despite overall volatility, Coinbase is accelerating its transformation through the “Everything Exchange” strategy, diversifying its revenue streams, with strong fundamentals attracting fresh capital.

(Coinbase’s Q4 net loss exceeded $600 million, stock down nearly 70% from its high)

Macro sentiment and outlook

Although the crypto market’s “Fear and Greed Index” remains in extreme fear at 11, several technical indicators have signaled oversold conditions, attracting long-term bottom-fishing capital, with related stocks like MicroStrategy (MSTR) also gaining strength. Looking ahead, next Monday’s U.S. market will be closed for Presidents’ Day, with focus continuing on Federal Reserve officials’ interpretations of CPI data and corporate profitability and transformation efficiency amid the AI wave.

This article “Inflation Data Cools and Eases Pressure, Bitcoin Returns to 69K” first appeared on Chain News ABMedia.