Bitcoin News Today: June Core PCE Rises to 2.7% Annualized Cooling Rate-Cut Hopes

The U.S. Bureau of Economic Analysis (BEA) released the June 2025 Core PCE Price Index at 20:30 Beijing time, showing an annualized rate of 2.7%, slightly above the median analyst forecast of 2.66% from the Cleveland Fed nowcasting model [6]. The data indicated continued inflationary pressures despite a generally resilient economic backdrop. The month-over-month increase came in at 0.29%, slightly outperforming expectations of 0.3% but a modest acceleration from the prior month’s 0.2% [1].

The release had an immediate effect on global financial markets. The U.S. Dollar Index (DXY) gained strength near the 100.00 level as the data reinforced expectations of a prolonged high-interest-rate environment [3]. The USD/CAD pair extended its gains above 1.3815, reflecting broader dollar strength driven by the inflation report [2]. Meanwhile, expectations of a potential September rate cut by the Federal Reserve were tempered, with analysts noting that a lower-than-expected PCE could have spurred increased speculation around dovish monetary policy [7].

Cryptocurrency markets also reacted to the inflation data. Bitcoin (BTC) and Ethereum (ETH) experienced volatility as traders adjusted their positions based on the implications of the PCE for inflation expectations and central bank policy. Given that the Core PCE is the Federal Reserve’s preferred inflation indicator, its reading directly influences monetary policy decisions, including potential shifts in interest rates [6]. Historical trends suggest that unexpectedly high PCE readings may prompt sell-offs in risk-on assets, including crypto, while lower readings could lead to rallies [1].

The Federal Reserve is expected to continue monitoring the inflation data closely as it shapes its policy outlook. While the core PCE had previously shown a 3.5% annualized rate in Q2 before easing to 2.5% in June, the latest reading of 2.7% underscores the lingering inflationary pressures that remain above the Fed’s 2.0% target [4]. Analysts suggest that the data could influence the central bank’s decision-making during both its July and September meetings, although no official statements from Fed leadership have been made publicly [1].

The broader macroeconomic environment will play a role in shaping future trends. Analysts highlight that rising tariffs and fees related to equity-driven portfolio management have contributed to sector-specific inflationary pressures. While some sectors, such as domestic manufacturing and asset management, appear to benefit from inflationary conditions, others—particularly those sensitive to interest rate changes—remain vulnerable to market volatility [1]. Investors are advised to remain cautious and consider sector-specific strategies that align with the nuanced inflation landscape.

Source: [1] A Deep Dive into PCE Trends and Investment Strategies https://www.ainvest.com/news/navigating-sector-opportunities-modly-inflating-economy-deep-dive-pce-trends-investment-strategies-2507/

[2] USD/CAD holds gains above 1.3815 with US PCE Inflation https://www.mitrade.com/insights/news/live-news/article-1-1000631-20250731

[3] US Dollar Index (DXY) holds gains near the 100.00 level https://www.mitrade.com/insights/news/live-news/article-4-1001147-20250731

[4] Fed Rate-Cut Odds Slide On Powell Framework; S&P 500 https://www.investors.com/news/economy/federal-reserve-meeting-fed-chair-powell-gdp-jobs-data-sp-500/

[5] US Core Personal Consumption Expenditures - Price Index https://www.fxstreet.com/news/us-dollar-index-holds-losses-near-10000-ahead-of-pce-inflation-data-202507310253

[6] The U.S. June Core PCE Price Index is About to Be https://www.binance.com/square/post/27678330253138

[7] Markets Await Core PCE June 2025: EUR/USD, Gold, S&P https://medium.com/@uptexforex/markets-await-core-pce-june-2025-eur-usd-gold-s-p-500-bitcoin-forecast-6192f3c5e4ad