Bitget App
Trade smarter
Buy cryptoMarketsTradeFuturesEarnSquareMore
Even as Inflation Risk Fades, Bitcoin Remains Stuck Below $31K

Even as Inflation Risk Fades, Bitcoin Remains Stuck Below $31K

CoindeskCoindesk2023/07/12 18:59
By:Stephen Alpher

Wednesday's CPI report showed sizable decelerations in both overall and core U.S. inflation, which one might've thought would drive BTC's price higher.

(JESHOOTS.COM/Unspalsh)

Bitcoin () investors received what should have been welcome economic news Wednesday as the government reported a big slowdown in U.S. inflation.

And, indeed, bitcoin's price quickly shot up to almost $31,000 following the report. It didn't last long. As of press time, BTC had pulled back below $30,500, down more than 1% from where it was before the Consumer Price Index (CPI) data was released.

The report showed consumer prices increased 3% year-over-year in June, versus the 4% gain in May. Even better, the core rate – which excludes food and energy prices – slowed to a 4.8% increase after stubbornly holding above 5% earlier in 2023.

To the extent that speedy inflation has been among the headwinds sending bitcoin tumbling from its peak near $70,000 in November 2021, fading inflation risks would seemingly be supportive. That this didn't happen today brings forth a few issues.

First, perhaps it's another in what's been a number of inflation head fakes in the Covid era. Remember 2021's "transitory" phase in which the U.S. Federal Reserve was convinced it didn't need to act on rising inflation due to its expectation that it was a temporary blip? Commenting on this morning's CPI, The Wall Street Journal's Nick Timiraos was in July and August 2021, which seemed to confirm that hypothesis before subsequent data said otherwise. Timiraos doesn't expect the Fed to be swayed from its path of additional rate hikes in 2023 by just this morning's data.

Second, there was more news today than just the CPI print. showed two wallets labeled as belonging to the U.S. government and linked to seized bitcoin holdings from the Silk Road marketplace moved 9,825 bitcoin ($301 million) in three transactions. That sort of selling pressure may have more than balanced out any good inflation news.

Finally, markets anticipate. The price of bitcoin has risen more than 20% since mid-June. While the catalyst for that is commonly thought to be the (and subsequent filings by a number of other asset managers, including ), perhaps some of the bullish action was due to markets sniffing out the improved June inflation report. As Timiraos , observers had been talking about sizable softening in some of the CPI components for some time.

Maybe doubly frustrating the bitcoin bulls today is that traditional markets appear to have fully embraced the weaker inflation report. The dollar index is off more than 1%, which is exactly what one might expect if inflation concerns and subsequently the chances of future Fed rate hikes were receding. The 10-year Treasury yield is off a full 13 basis points (0.13%) to 3.84% and the two-year yield is down the same amount to 4.74%. And while bitcoin resides in the red on Wednesday, both the Nasdaq and SP 500 are ahead by about 1% and hitting new all-time highs.

Edited by Nick Baker.

166

Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.

PoolX: Earn new token airdrops
Lock your assets and earn 10%+ APR
Lock now!

You may also like

TWT’s Updated Tokenomics Framework and What It Means for DeFi Investors: An In-Depth Analysis of Incentive Structures and Sustainable Value Growth

- TWT's 2025 tokenomics model combines deflationary supply (post-2020 burn of 90% tokens) with utility-driven incentives like Trust Premium and FlexGas to align user behavior with long-term value. - Governance rights and RWA integrations (e.g., U.S. Treasury bonds via Ondo Finance) enhance TWT's utility, attracting institutional investors and bridging DeFi with traditional finance. - Binance co-founder CZ's endorsement and bullish price projections ($15 by 2030) highlight TWT's potential as a hybrid asset

Bitget-RWA2025/11/30 03:28
TWT’s Updated Tokenomics Framework and What It Means for DeFi Investors: An In-Depth Analysis of Incentive Structures and Sustainable Value Growth

Industrial Property Prospects in Webster, NY, Boosted by Targeted Infrastructure Funding

- Webster , NY, is transforming a 300-acre Xerox brownfield into a high-tech industrial hub via $9.8M FAST NY grants and public-private partnerships (PPPs). - Infrastructure upgrades, including road realignment and sewer expansion, enabled $650M private investments like the fairlife® dairy plant, creating 250 jobs by 2025. - Residential property values rose 10.1% annually, industrial vacancy rates dropped to 2%, and ESG-focused projects like wastewater upgrades boosted investor appeal. - The model highligh

Bitget-RWA2025/11/30 03:28
Industrial Property Prospects in Webster, NY, Boosted by Targeted Infrastructure Funding

Bitcoin Updates Today: MicroStrategy’s Bold Bitcoin Move: Challenging Doubters or Setting Off a Ticking Bomb?

- MicroStrategy reaffirms Bitcoin-centric strategy, holding 3% of BTC supply despite market skepticism and stock volatility. - $21B in equity/debt financing fueled Bitcoin accumulation, creating leverage-driven profits tied to price swings and dilutive capital raises. - Stock-NET asset value parity and $5.38B institutional outflows highlight risks from Bitcoin volatility and financing model criticism. - Custody shift to Fidelity reduced on-chain transparency while index exclusion limits passive demand amid

Bitget-RWA2025/11/30 03:12
Bitcoin Updates Today: MicroStrategy’s Bold Bitcoin Move: Challenging Doubters or Setting Off a Ticking Bomb?

WFE Cautions That Tokenized Stocks May Threaten Market Integrity and Lead to Regulatory Disparities

- Nasdaq pushes SEC to approve tokenized stocks, facing WFE warnings about eroded market integrity and investor protections. - WFE argues blockchain adoption costs outweigh benefits in already efficient equity markets, urging adherence to established frameworks. - SEC's crypto-friendly shift under Trump creates tension between innovation and regulatory safeguards, with global standards remaining fragmented. - Tokenized assets could enable 24/7 trading but risk regulatory fragmentation and systemic risks hi

Bitget-RWA2025/11/30 03:12
WFE Cautions That Tokenized Stocks May Threaten Market Integrity and Lead to Regulatory Disparities