Recaps · US CPI · 10 May 2023, 13:30 UK
Under 5%, slowly
The April 2023 inflation report was close to forecasts, but it carried a milestone: annual inflation below 5% for the first time in two years. Bitcoin rose without a single big candle and kept rising for four hours. The next day it gave the gain back.
- Release
- Wednesday 10 May 2023, 13:30 UK
- Headline CPI
- +0.4% m/m, 4.9% y/y (March: 5.0%)
- Core CPI
- +0.4% m/m, 5.5% y/y
- Milestone
- Smallest 12-month rise since April 2021 (BLS)
- Bitcoin at release
- $27,725
The report
The Bureau of Labor Statistics said the 4.9% annual rise was the smallest since the period ending April 2021. The monthly numbers were less friendly. Prices rose 0.4% on the month, driven by shelter, used cars and petrol, and core prices also rose 0.4%. Reuters called the report mixed and said it dashed market hopes that the Fed would cut rates that year. It also reported that two-year Treasury yields fell about 12 basis points after the data.
A climb in steps
- 1 14:00 UK: about +2%
- 2 17:25 UK: back near +2%
Bitcoin rose +0.96% on the first candle and reached about 2% up by 14:00 UK. It pulled back in the next fifteen minutes, then climbed again to +2.11% at 17:30 UK. The first hour, +1.45%, ranks #25 of 117 CPI releases at 3.1 times a normal hour. Stocks did not join in: the S&P 500 ETF was -1.1% at four hours.
| Market | 5m | 1h | 4h | 24h | 1w | × normal hour |
|---|---|---|---|---|---|---|
| Cardano | +1.51% | +2.79% | +3.79% | +0.93% | +2.03% | 5.1× |
| Litecoin | +1.46% | +2.03% | +2.21% | +2.68% | +15.40% | 2.9× |
| Bitcoin | +0.96% | +1.45% | +2.11% | −0.57% | −3.76% | 3.1× |
| Solana | +1.57% | +1.71% | +1.90% | −0.62% | −0.81% | 3.0× |
| Ethereum | +1.04% | +1.25% | +1.57% | −0.98% | −3.17% | 2.1× |
| Chainlink | +1.22% | +1.83% | +1.53% | −0.46% | +0.92% | 2.6× |
| XRP | +1.29% | +1.37% | +1.36% | +0.41% | +5.12% | 1.9× |
Change from the 13:30 UK release, sorted by the first hour.
How it compares with spring 2023
The spring of 2023 gives three CPI days to compare. The March release came two days after the US rescue of Silicon Valley Bank's depositors, and Bitcoin rose 5.0% in its first hour, 10.8 times normal. In April, with no crisis, it barely moved, 0.6% and 1.2 times normal. May sits between them. When a report is close to forecast, the reaction tends to depend on what else the market is worried about, and on whether a round number such as 5% gives traders a simple headline to act on.
Cardano led the coins, +3.8% at four hours and 5.1 times its normal hour. Litecoin was +15% over the following week while Bitcoin was -3.8%. Bitcoin was -0.57% a day after the release, below where it started, so the four-hour gain did not last.
Sources: release time and figures from the U.S. Bureau of Labor Statistics (public domain), first-print values via ALFRED, Federal Reserve Bank of St. Louis. Crypto: Bitstamp 5-minute candles; SPY/QQQ: IEX. No consensus forecasts are shown because they are proprietary; comparisons are with the previous release. “× normal hour” compares the first-hour move with the median move in matched quiet hours. How we measure it.