Cryptocurrencies experienced a boost from macroeconomic data during this holiday season’s ongoing rally, propelling several coins and tokens to soar in price. Cosmos Hub (CRYPTO: ATOM) surged by 19% in midafternoon trading, while KuCoin (CRYPTO: KCS), Aptos (CRYPTO: APT), and Fantom (CRYPTO: FTM) followed suit, recording gains of 19%, 14%, and 7%, respectively.

The catalyst for this upsurge was the release of the U.S. Consumer Price Index (CPI) figures by the Labor Department, indicating a year-over-year increase of 3.1% and a 0.1% uptick from October. Although meeting economist expectations, the slight slowdown in inflationary growth signals a positive trend, suggesting a gradual cooling of inflation rates.

For cryptocurrency investors, inflation’s trajectory holds significance. A decline in inflationary pressures might alleviate the Federal Reserve’s inclination to further increase key interest rates. In an ideal scenario, if inflation continues to ease, the possibility of rate cuts by the Fed could arise.

However, amidst this positive sentiment, caution is advised. While cryptocurrencies like Cosmos and KuCoin exhibit potential, the market’s momentum might benefit even riskier options. Investors should exercise caution in this volatile environment and consider investing in the most promising and credible cryptocurrencies. Negative economic news could swiftly reverse the current market enthusiasm, as has been witnessed previously. Therefore, even in favorable market conditions, cryptocurrencies remain notably volatile assets.