Bitcoin Tumbles as Hot CPI Data Reduces Rate Cut Hopes

by Ouess

The crypto market is feeling the heat after June’s higher-than-expected CPI report sent Bitcoin prices tumbling. With inflation ticking up to 2.7% year-over-year (versus 2.6% expected), traders are quickly reassessing their Fed rate cut bets.

Key CPI Takeaways Moving Markets

🔥 June CPI: 2.7% YoY (up from May’s 2.4%)
🔥 Core CPI: 2.9% YoY (still above Fed’s 2% target)
🔥 Market reaction: BTC drops 3% within minutes
🔥 Fed rate cut odds: July chances fall below 15%

“Not a massive miss, but enough to keep the Fed guessing,” noted crypto analyst Kyledoops. “The market hates uncertainty.”

Why Bitcoin Reacts So Strongly

1️⃣ Risk asset status: Crypto moves with rate expectations
2️⃣ Dollar strength: Higher rates = stronger USD = BTC pressure
3️⃣ Liquidity outlook: Less chance of Fed easing hurts crypto

The Kobeissi Letter had warned earlier:

“Hot CPI could trigger a big selloff” – and that’s exactly what we’re seeing.

What’s Next for Bitcoin?

  • Short-term: Volatility likely to continue
  • Key support: $116K level critical to hold
  • PPI data tomorrow: Another potential catalyst

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