Bitcoin Gains Slightly as U.S. CPI Data Fuels Fed Rate Cut Speculation
Bitcoin staged a modest recovery to $117,300 after dropping sharply from record highs above $124,000 a day earlier, as new U.S. inflation data largely met expectations and reinforced hopes for a potential Federal Reserve rate cut later this year.
June’s Consumer Price Index (CPI) rose 0.3%, matching forecasts and accelerating from 0.1% in May. On an annual basis, inflation reached 2.7%, in line with estimates and up from 2.4% the previous month.
Core CPI, which excludes food and energy, increased 0.2% for the month, slightly below the anticipated 0.3%, and up from May’s 0.1% gain. Year-over-year, core prices climbed 2.9%, just shy of the 3.0% consensus and above May’s 2.8%.
Traditional markets responded positively to the data. Futures for the S&P 500 edged 0.4% higher, while the yield on the 10-year Treasury slipped two basis points to 4.41%.
Investors are closely watching inflation trends to gauge when the Fed might cut rates. While some Fed officials have suggested a rate reduction could come as soon as the late July meeting, most—including Fed Chair Jerome Powell—appear inclined to wait.
That puts the spotlight on the Fed’s September meeting as the likely window for potential easing. Before today’s CPI release, CME’s FedWatch Tool showed nearly a 62% chance of a rate cut in September.
