Key facts
- Bitcoin rose to near $64,800 following a larger-than-expected monthly decrease in U.S. inflation.
- June headline inflation slowed to 3.5% year-over-year, down from 4.2% in May.
- Core inflation eased to 2.6% annually, down from 2.9% in May.
- The cooling inflation data significantly reduced market expectations for a Federal Reserve rate hike.
- Implied odds of a Fed rate increase fell from 43% to 13% after the inflation report.
- Ethereum also saw gains, rising 5.3% to $1,880.
Bitcoin surged to near $64,800, its best session in weeks, following a larger-than-expected cooling in U.S. inflation. The June headline Consumer Price Index (CPI) slowed to 3.5% year-over-year from 4.2%, while core inflation eased to 2.6% from 2.9%. This data sharply reduced market odds of a near-term Federal Reserve rate hike, with implied odds of an increase collapsing from 43% to 13%. The decline in inflation expectations boosted cryptocurrencies and global equities as traders rotated back into risk assets. Analysts note that Bitcoin remains sensitive to interest-rate expectations, with the current data easing immediate downside pressure. However, the next major tests include the Fed's September meeting and the sustainability of Bitcoin ETF inflows. Geopolitical tensions involving Iran and the Strait of Hormuz also loom, though Brent crude advanced on President Trump's threats.