Bitcoin and digital currencies show signs of recovery before the release of the US inflation report. The report affects expectations for interest rate hikes or cuts by the Federal Reserve, which directly impacts the performance of high-risk assets such as digital currencies. A decrease in inflation may weaken momentum in the digital currency market, as investors might expect the Fed to lower interest rates later, temporarily reducing the appetite for high-risk assets. On the other hand, an increase in inflation may ignite investors' appetite for hedging and drive them towards Bitcoin $BTC as an alternative asset against the erosion of purchasing power.