Bitcoin has crossed the significant mark of $65,000 on Tuesday, driven by new inflation data revealing a noteworthy drop in consumer prices. The largest monthly decrease since April 2020 saw Bitcoin climbing up to $65,100, reflecting a rise of over 4% in a single day. In contrast, Ether outperformed Bitcoin, soaring almost 7% to approximately $1,895.
The U.S. Bureau of Labor Statistics reported a 0.4% reduction in the Consumer Price Index for June, considerably exceeding the anticipated 0.2% dip. On an annual basis, inflation eased to 3.5%, down from 4.2%, marking the first slowdown after hitting a three-year peak in May. This drop was mainly due to a decrease in energy prices, with gasoline plummeting over 9% in June, counteracting increases in food and housing costs.
As traders recalibrate their expectations, confidence grows that the Federal Reserve will maintain interest rates in the 3.5% to 3.75% range at the upcoming meeting. However, a number still anticipate a 25-basis-point hike in September. The Fed's recent more hawkish stance could have pressured risk assets like Bitcoin, but the latest inflation report has relaxed some of those concerns.
As geopolitical tensions rise, particularly related to the U.S.-Iran situation, the economic landscape remains uncertain. For more insights on the ebb and flow of markets, see how oil prices are reacting amid these tensions.
This material is for informational purposes only and should not be considered financial advice.
