Tonight, when the US January CPI data is released, the market reacted within less than half an hour, and Bitcoin surged sharply, breaking through the recent resistance level of $94,500. Many people started celebrating upon seeing this result, but let's stay calm and analyze it carefully.

**Key Data Highlights**

Overall CPI increased by 3.1% year-on-year, which is in line with market expectations, so nothing special there. The real eye-catcher is the core CPI—up 3.9% year-on-year, slightly below the expected 4.0%. Although only a 0.1 percentage point difference, it's enough. The market logic is straightforward: inflation is easing → the Federal Reserve is more likely to cut interest rates → market liquidity improves → risk assets (like Bitcoin) rise accordingly. Additionally, the market was worried that inflation might "stick" at high levels, but this data dispels that concern, leading to increased risk appetite.

**Why Bitcoin Will Follow the Rise**

In simple terms, the entire transmission chain is: inflation eases → the Fed is more likely to cut rates → market liquidity improves → risk assets (such as Bitcoin) go up. Moreover, the market previously feared that inflation would remain sticky at high levels, but this data alleviates that concern, boosting risk appetite.

**But Don't Be Too Optimistic**

While the data is positive, the market consensus is that the Federal Reserve is unlikely to start cutting rates immediately at the March policy meeting. We still need to pay close attention to subsequent economic data, as these will be the real factors determining the pace of rate cuts.