Reserve Dollar

bullish

Bitcoin

Drops

Reserve

The post <a href="https://coinpedia.org/price-analysis/cpi-report-today-bitcoin-fluctuates-near-62k-as-inflation-rate-dips-to-2-9-matching-expectations/" rel="noopener noreferrer nofollow">CPI Report Today: Bitcoin Fluctuates Near $62K as Inflation Rate Dips to 2.9%, Matching Expectations</a> appeared first on <a href="https://coinpedia.org" rel="noopener noreferrer nofollow">Coinpedia Fintech News</a>
The latest Consumer Price Index (CPI) report has revealed a 2.9% inflation rate, significantly better than market expectations. This positive development has brought hopes for potential interest rate cuts, which, in turn, has created a bullish sentiment in the crypto market. As a result, Bitcoin price broke above its immediate consolidation.
<h2 class="wp-block-heading" id="h-inflation-drops-below-3-since-march-2021">Inflation Drops Below 3% Since March 2021</h2>
In the US, the Consumer Price Index (CPI), which tracks inflation, dropped to 2.9% for the year in July, down from 3% in June, according to a report by the US Bureau of Labor Statistics (BLS) on Wednesday. This figure dropped below what experts had predicted.
The core CPI, which doesn’t include the often-fluctuating costs of food and energy, went up by 3.2%. This follows a rise of 3.3% in July and was exactly what analysts expected. Both the overall CPI and the core CPI increased by 0.2% on a monthly basis.
The information was released a day after the producer-price index, which lowered investor concerns by indicating slowing inflation at the production level.
With the Federal Reserve’s next meeting about a month away, traders are urgently trying to predict the direction of interest rates, particularly after disappointing job market figures. Before today’s data release, the debate over whether the U.S. Federal Reserve would lower its benchmark fed funds rate at the next meeting seemed settled.
According to CME FedWatch, which calculates probabilities based on market positions in short-term interest rates, there was no chance that the rate would stay at the current 5.25%-5.50%. In fact, the tool indicated a 52.5% likelihood of a 50-basis point rate cut compared to a 47.5% chance for a 25-basis point reduction.
The inflation reports, slightly better than anticipated, likely confirm that the Fed will reduce rates at its September meeting—the first cut in 4.5 years. Such a move is expected to boost the stock and crypto markets.
This is the first time since March 2021 that inflation has dipped below 3%.
<h2 class="wp-block-heading" id="h-bitcoin-price-climbs-toward-62k">Bitcoin Price Climbs Toward $62K</h2>
After the positive CPI report, the cryptocurrency market saw an uptick, with Bitcoin’s price reaching around $61.8K, recovering some of its early August losses. Over the past 24 hours, Bitcoin has climbed more than 3.5%, outpacing the overall crypto market’s gain of just over 2.2%. However, BTC faced a downward volatility in the last few minutes, consolidating around $61,000.
Experts believe that a higher CPI puts more pressure on cryptocurrencies. Quick and significant fluctuations in the CPI are often indicators of volatility in the crypto market. However, the recent drop in inflation might reduce the volatility on crypto assets, allowing investors to invest in Bitcoin heavily.
Next on the U.S. economic calendar are tomorrow’s initial jobless claims and retail sales reports. Before the end of August, the Federal Reserve’s Jackson Hole symposium will also take place. In the past, former Fed chairs have sometimes used this conference to announce or hint at significant policy changes.

CPI Report Today: Bitcoin Fluctuates Near $62K as Inflation Rate Dips to 2.9%, Matching Expectations

Table of Contents

CoinPedia News

Other articles published on Aug 14, 2024

WebX 2024 in JAPAN: A Two-Day Gathering of Companies Venturing into Web3, Led by the Anime Industry

US Policy Group Proposes Bitcoin Tax-Free Zone to Boost Digital Economy

BestChange Unveils AML Analyzer: Enhances Crypto Security and Compliance

Is the Central Bank of India’s Digital Rupee Project Being Powered by the XRP Ledger?

Crypto That Cares: Stellar’s Role in Revolutionizing Financial Systems in South America

Avatar.One Helps Over 120K Active Users Battle the Loneliness Epidemic with 3D AI Companions

Join our free newsletter for daily crypto updates!