Bitcoin Slips to $63,500: Inflation Data Fails to Deliver Expected Impact

Bitcoin price pulled back to the $63,500 level as U.S. inflation data, which aligned with expectations, failed to spark a strong shift in market direction.

Bitcoin retreated to around $63,500 on Thursday, losing over 0.5% and bringing its weekly loss to approximately 2%.

Consumer inflation for July in the U.S. came in almost exactly as economists expected. Headline inflation rose 0.1% month-over-month and 3.4% year-over-year. Core inflation, which excludes food and energy prices, increased by 0.2% monthly and fell to 2.5% on an annual basis.

Next Critical Data for Bitcoin

Following the data, the expectation that the Fed will hike interest rates in September dropped from 46% to 38%. Gabe Selby, Research Director at CF Benchmarks, noted that Bitcoin moves sharply particularly during periods when inflation data alters interest rate expectations. According to Selby, data that came in below expectations in three of the last nine inflation announcements brought an average increase of 3.25% in Bitcoin. However, it was stated that data in line with expectations only eliminates one of the market’s negative scenarios, and a surprise is needed for a strong move.

The market’s focus is now on the Jackson Hole meeting, the September 4 employment report, and the September 11 inflation data. In the altcoin market, HYPE rose over 3% to reach $56, while Tron extended its weekly gains to 2%. Dogecoin fell by approximately 3%, XRP by 1%, and BNB by over 1%. In traditional markets, Asian stocks rose while Brent crude oil pulled back after approaching the $90 level.