Bitcoin News Today: Higher US Inflation Lowers Rate Cut Odds Boosting Crypto Volatility

The recent release of U.S. inflation data for June has significantly altered expectations in the cryptocurrency market, prompting a reassessment of Federal Reserve policy and market volatility. The data revealed higher-than-anticipated inflation, shifting the probability of rate cuts downward—now at 58.7% for maintaining current rates into September and a reduced chance of a 25 basis point cut. This uncertainty has triggered increased volatility in major cryptocurrencies, particularly Bitcoin (BTC) and Ethereum (ETH), as traders brace for potential macroeconomic shifts and policy-driven market fluctuations[1].

Analysts from 10xResearch highlight the critical timing of upcoming economic developments, including corporate earnings reports, the White House digital asset report, and the Federal Open Market Committee (FOMC) meeting. These events, occurring before the historically weaker summer months, are expected to influence trader behavior and market dynamics significantly. The market is currently in a precarious position, with participants navigating a complex macroeconomic environment amid shifting Federal Reserve guidance[1].

James Check from Checkonchain described the market sell-offs as “traditional benign,” yet underscored the growing challenges posed by the evolving macroeconomic landscape. On-chain activity, such as OP_RETURN transactions published by Galaxy, has added a layer of transparency, enabling closer scrutiny of market signals and investor sentiment. Meanwhile, data shows Bitcoin trading at $115,135.34, with a 61.07% market dominance and a market capitalization of $2.29 trillion. However, recent 24-hour trading volumes show a decline, with a -3.00% drop over the past day and a -0.09% change in the last week[1].

Historical data suggests that periods of Federal Reserve indecision often coincide with significant drawdowns in the cryptocurrency market, reinforcing concerns about potential volatility in the coming months. The Coincu research team has pointed to possible challenges in liquidity management and regulatory adjustments, noting that historical price movements of BTC and ETH following macroeconomic announcements offer a predictive framework for current conditions. As traders monitor these developments, the focus remains on balancing risk exposure with strategic positioning ahead of critical policy and economic announcements[1].

Source: [1] US Inflation Rise Alters Crypto Market Expectations (https://coinmarketcap.com/community/articles/688c683d8eaa8512bbd69bf9/)