Breaking: Bitcoin Price To Rally As US CPI Inflation Cools To 2.9%

Bitcoin price saw upside momentum as U.S. consumer price index (CPI) inflation cools further to 2.9%, as per the latest the U.S. Bureau of Labor Statistics. After the PPI inflation reduced more than expected, the slowing CPI print will allow the U.S. Federal Reserve to start easing its monetary policy.

US stock futures were flat for Dow Jones, S&P 500 and Nasdaq Composite on Wednesday as investors look for cues on moderate price increases. Crypto traders turned bullish even before the CPI release due to buy-the-dip calls ahead of high anticipation for the Fed rate cuts starting in September.

US CPI Comes In Cooler

The annual CPI inflation rate in the US eases to 2.9%, down from 3% in June. Compared to the previous month, the inflation increase to 0.2%, rebounding from a 0.1% drop in June.

Meanwhile, core inflation came in at 3.2%, easing for the fourth consecutive month and 3.3% last month. It is the lowest reading since April 2021. The monthly core inflation rate also rose to 0.2% from 0.1%. However, it’s lower than 0.3% in the previous month.

The cooling inflation in all terms indicates room for the Fed to announce a rate cut. The central bank would still wait for upcoming jobs data and PCE inflation data before confirming its stance on rate cuts. The market bets for a larger interest rate cut from the Federal Reserve in September.

CME FedWatch tool data indicates more than 50% probability of a 50 bps rate cut in September. The data also show odds of 100 bps rate cuts by the Fed this year.

BTC price gained further after the inflation data, with a 5% jump in the past 24 hours. The price is currently trading at $61,403, with a 24-hour low and high of $58,788 and $$61,572, respectively. Furthermore, the trading volume has decreased by 12% in the last 24 hours.

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