Bitcoin News Today: Crypto Market Surges 6% as June Inflation Data Boosts Fed Rate Cut Hopes

The crypto market is experiencing a surge, with Bitcoin and major altcoins leading the charge. This momentum followed the release of the U.S. inflation report for June, which showed a modest rise in prices that largely met expectations. This data prompted traders to maintain hopes for a potential Fed rate cut in September.

June’s Consumer Price Index (CPI) data revealed that inflation rose by 2.7% year over year, slightly higher than May’s 2.4%. Core CPI, which excludes food and fuel, reached 2.9%. These figures suggest that price increases weren’t sharp enough to deter the Federal Reserve from considering a rate cut, providing some relief to investors. The market reacted swiftly, with crypto prices rising across the board.

Prior to the CPI data release, Bitcoin had dipped below $116,000 but quickly recovered, climbing above $118,000 following the report. This pattern is not uncommon, as Bitcoin often dips before inflation data is released and then rallies once the report comes out. The inflation figures for June showed that headline inflation reached 2.7% over the past year, the strongest yearly rise since February. Core inflation came in at 2.9%, just under market forecasts. On a monthly basis, overall prices rose by 0.3%, and core prices moved up by 0.2%.

Bitcoin wasn’t the only cryptocurrency moving higher. Ethereum jumped by more than 6% over the past 24 hours. XRP, Binance Coin (BNB), Solana, and Dogecoin also saw gains. XRP rose by 3%, BNB by 2.4%, and both Solana and Dogecoin gained 5%. This upward movement in prices signals growing confidence in the crypto market, particularly as institutional interest increases. Significant inflows into U.S. spot Bitcoin ETFs and Ethereum funds were recorded, with over 7,500 BTC added on Monday and an additional 3,400 BTC on Tuesday. Ethereum funds also had a strong showing, with inflows totaling $192 million, marking eight straight days of gains.

Eugene Cheung, chief commercial officer at OSL, viewed the latest figures as a positive signal for digital assets, as they also raised the likelihood of a Fed rate cut in September—a move that could attract more capital into the crypto market. The outlook appears to be taking shape, with strong investor confidence reflected in the minimal outflows from U.S. spot Bitcoin ETFs during this period. However, investors remain cautious, awaiting more data to clarify inflation’s path. While the June CPI report offered some reassurance, uncertainty lingers about how the Federal Reserve will act at its July FOMC meeting.

Market odds still lean toward a rate cut in September, with the likelihood placed at around 54%. However, the next key data release—the Producer Price Index (PPI)—could shift market expectations. If the PPI reports inflation below predictions, Bitcoin could gain momentum and lift the broader crypto market. However, if the PPI shows stronger inflation, prices may pull back. For now, the broader trend remains upward, with Bitcoin holding steady through recent swings and momentum slowly building again. Much depends on how the next economic reports unfold.

Nick Ruck, director at LVRG Research, sees more room for prices to grow. He believes the current rally still has momentum and expects stronger gains in the second half of the year. This view aligns with analysts who remain among the most bullish, suggesting that if market conditions stay supportive, Bitcoin could reach new heights. The crypto market’s response to the June CPI data underscores the sensitivity of digital assets to economic indicators and the potential for significant price movements based on Fed policy expectations.