The price of Bitcoin (BTC) stabilizes just under $61,000 after the US CPI inflation report for September exceeded expectations.
Inflation Data for September
The year-over-year (YoY) rate of headline Consumer Price Index inflation registered at 2.4% for September, slightly above the anticipated 2.3%. Meanwhile, the YoY Core CPI rate came in at 3.3%, just above the forecast of 3.2%.
Recent updates show that the September US CPI annual inflation has risen to 2.4%, surpassing expectations. Additionally, the Core CPI inflation increased by 3.3% year-over-year, exceeding the anticipated 3.2%. These figures raise questions about Federal Reserve Chair Jerome Powell’s next steps.
Market Reactions to Inflation Reports
Both inflation rates have significantly decreased from post-pandemic peaks but remain above the Federal Reserve’s target of 2.0%. Fed policymakers reacted positively to this report, indicating ongoing progress toward the inflation goal.
Economic analyst Walter Bloomberg noted, “The overall trend is clearly that inflation has come down significantly.” Fed Governor Lael Brainard stated, “We keep making progress,” reinforcing the positive sentiment around the inflation data.
Macro traders responded to the report by increasing their expectations for a 25 basis point rate cut, bringing the target range to 4.50-4.75% in November. The CME’s Fed Watch Tool indicates an 87% probability of this rate cut next month, up from 80% just a day ago. However, this anticipation has not triggered a rally in Bitcoin’s price, which remains near its 50-day moving average around $60,000.
Bitcoin Price Struggles in October
In September, the Fed reduced interest rates by 50 basis points, leading to a significant market rally. Since then, Jerome Powell has downplayed the chances of further major rate cuts. Strong economic indicators—such as last week’s jobs report and the recent US CPI data—have tempered expectations for additional cuts.
Additionally, rising military tensions between Iran and Israel seem to have dampened sentiment in the Bitcoin market this month. Traditionally, October is a strong month for Bitcoin, often called “uptober.” However, Bitcoin’s price has dropped over 4% so far this month.
BTC Price Surge Around the Corner?
Despite current challenges, several positive factors could propel Bitcoin’s price higher later this quarter. The timeline and pace of the Fed’s rate-cutting cycle remain uncertain due to mixed signals regarding the US economy’s strength. However, barring an unexpected inflation spike, the anticipated rate-cutting cycle may create more favorable financial conditions.
As long as these developments coincide with a robust US economy, they could significantly benefit risk assets, including Bitcoin. Furthermore, there is an increasing likelihood of a Trump victory in the upcoming November presidential election. According to Polymarket, Trump is perceived as a more pro-crypto candidate, and his potential election could serve as a catalyst for a major price surge. Recent data shows Trump’s lead over Harris is growing, with a 7.3% increase in odds favoring his victory.
Additionally, it has been about six months since the last Bitcoin halving event, a historical point that often precedes significant bull markets in Bitcoin.
The post Bitcoin Price Consolidates Above $60,000 After Hot US Inflation Data – Is An “Uptober” Price Surge Still Coming? appeared first on Cryptonews.
