Crypto equities surge as US inflation prints three-month cooling streak; 'catch-up rally' expected, analyst says

April’s Consumer Price Index fell to 2.3%, slightly below economists' expectations of 2.4%, while the Core CPI remained steady at 2.8%, matching forecasts.  The latest data — the first inflation figures reflecting the impact of "Liberation Day" — marked headline inflation at a four-year low and represented the third consecutive monthly decline.

David Hernandez, crypto investment specialist at 21Shares, said the report suggested that "the economy may be holding strong" amid tariff-induced price pressures.

"The Federal Reserve's target inflation rate of 2% appears increasingly within reach, potentially influencing upcoming rate decisions." Hernandez said via email. "Odds of a rate cut at the June FOMC meeting still favor a pause."

Catch-up rally

Following the inflation data, crypto-related equities surged at Tuesday’s U.S. market open, driven by softer inflation numbers and easing economic strain. Coinbase (ticker COIN) rose 16% to $240 per share and led the blockchain stock rally, according to data from Yahoo Finance. The uptick continued COIN’s momentum from May 12, when news broke that Coinbase would join the S&P 500.

Shares of other crypto-focused companies, such as Bitcoin miners Marathon Digital and Riot Platforms, also rose, alongside broader gains in U.S. stock indices such as the S&P 500 and Nasdaq.

Conversely, the cryptocurrency market fell 3.4% on May 13 due to profit-taking. Bitcoin slipped to $103,200 while Ether held $2,540. Majors like XRP, BNB, and SOL shed gains from the previous day, with the GMCI 30 Index down nearly 1%, per The Block’s indices page.

Aurelie Barthere, principal research analyst at Nansen, told The Block that Tuesday's inverse price action between crypto and equities may indicate a "catch-up rally" to pre-tariff escalation levels for blockchain stocks. She argued that the recovery might even include altcoins despite the most recent downturn.

"Bitcoin is already trading close to its all-time highs,” Barthere said. "However, with the latest easing in trade tensions, it appears that altcoins, crypto and U.S. equities, and the U.S. dollar (DXY) are well-positioned for a catch-up rally."

The Nansen analyst opined that the greenback may strengthen against so-called safe-haven currencies, which may briefly stall BTC’s march to an all-time high.