Bitcoin added 0.7% to $114,610.0, while other cryptocurrencies showed mixed reaction
Bitcoin rose marginally on Thursday, extending overnight gains as weak U.S. producer inflation data fuelled increased optimism that interest rate cuts were imminent, with focus on upcoming data on consumer prices.
Meanwhile, the consumer price index (CPI) rose more than expected in August, but the data did not trigger any meaningful reaction from cryptocurrency markets.
Other cryptocurrencies showed mixed reaction in the wake of the release.
Bitcoin added 0.7% to $114,610.0 by 14:06 GMT. The crypto was still nursing steep losses logged in a tumble from mid-August record highs.
U.S. consumer prices rose more than anticipated in August while jobless claims unexpectedly surged, complicating the outlook for the country’s central bank just days before its policy meeting.
Bitcoin saw no significant movement after the report, maintaining slight gains in the past 24 hours.
The consumer price index (CPI) jumped 0.4% on the month, the sharpest rise since January, lifting the annual rate to 2.9%. Core CPI, which strips out food and energy, increased 0.3% and 3.1% year-on-year, in line with forecasts.
At the same time, weekly jobless claims jumped to 263,000, far above the 235,000 estimate and the highest level in almost four years.
The data comes as central bank officials prepare to decide on interest rates at their September 17 meeting.
Futures markets fully price a quarter-point cut from the current 4.25%–4.5% range, though traders see some risk of a larger half-point move given labour market weakness and still-contained inflation.
Bitcoin gained earlier this week after U.S. producer price index data came in weaker than expected for August.
The figure helped quell some concerns that Trump’s trade tariffs would spark an outsized rise in inflation, and saw markets largely maintain bets on an interest rate cut by the central bank next week.
Lower rates stand to benefit crypto, given that they free up more market liquidity for investing in speculative assets. The bank’s steady rate cuts through 2024 were a major point of support for Bitcoin, which rallied exponentially last year.
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