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Crypto rallies for a second day, with bitcoin jumping above $26,000

A visual representation of Bitcoin.

Edward Smith | Getty Images

Bitcoin jumped on Tuesday to levels not seen since last summer, extending its Monday rally as investors weighed the latest inflation data.

Bitcoin rose more than 7% to $26,110.50, according to Coin Metrics. Chart analysts had been eyeing $25,200 as a key level to watch. Ether added 3.7% to trade at $1,747.11.

Bitcoin is now up about 28.5% since Friday, when regulators shut down Silicon Valley Bank, and 59% for 2023. Ether has gained 20% since Friday and 45% year-to-date.

The jump coincided with the latest consumer price index reading, which showed an increase of 0.4% in February from January, matching the consensus estimate of economists polled by Dow Jones. So-called core CPI, which removes volatile food and energy prices, showed a monthly increase slightly above economists’ expectations, and a year-over-year change in line with expectations.

Stock Chart IconStock chart icon

Bitcoin (BTC) post CPI

Cryptocurrency prices have recovered dramatically since late last week, with market sentiment flipping 180 degrees after U.S. regulators backstopped the depositors of Silicon Valley Bank and Signature Bank. This led some investors to speculate that the Fed would be less aggressive in raising interest rates.

While bitcoin hasn’t been trading as closely with equities like it did for much of 2022, its price is still largely driven by macro data and some analysts expect to see a bigger return to that correlation, even with idiosyncratic events driving much of the action in 2023.

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