When inflation data in the United States were lower than expected, the encrypted market was stronger for a time, but bitcoin and the Etheraf subsequently rebounded. Market judgements suggest that a moderate inflation reading is not enough to drive the Fed to move quickly, and that oil price upwards complicates the prospects for subsequent inflation.
Bitcoin goes up and goes back to work.
At the time of reporting, Bitcoin had reported about US$ 64,532 and had increased about 3 per cent for 24 hours, but had fallen back about 0.5 per cent since zero. The Ether House grew by about 4.7 per cent 24 hours, also falling about 0.5 per cent in the daytime.
Markets had previously been less pressured by the weak-than-expected inflation data in the United States, but prices had not continued to move unilaterally. The traders began to reassess whether the Fed would adjust the interest rate path as a result of improvements in the single-month data.
Interest rate bets are coming back fast.
Polymarket data show that, following the publication of inflation data, the market's bet on the Fed's interest rate hike this month fell from 34 per cent to 6.7 per cent. At present, the probability that the bet rate will remain unchanged has risen to 93 per cent.
The CME Fedwatch tool shows that the 30-day Federal Fund futures price is only 14.4 per cent of the current month ' s interest rate increase. This means that, while the market has weakened expectations for further tightening, it has not been able to quickly shift to interest-rate reduction.
Oil prices raise subsequent pressure
Brent crude oil has now risen above $85 per barrel, putting new pressure on the inflation fall-back process. The report also mentioned that the possibility of a European Central Bank (ECB) interest rate reduction in July had also decreased significantly.
Next, the market will focus on later published price data for United States producers, as well as the PCE price indicators for the end of the month. These two data will continue to influence the market ' s judgement as to whether inflation continues to cool.
Against this background, the next move in bitcoin may no longer depend primarily on the July outcome, but rather on the continued fall in inflation and whether the upturn in oil prices will push up the price pressure again. The impact of the situation in the Middle East on hydrocarbon flows also remains a current market concern.