Bitcoin’s price dipped slightly before remaining mostly steady after data on Wednesday showed that U.S. inflation was subdued.
The price of the largest cryptocurrency recently stood at $63,863, mostly unmoved over a 24-hour period. Over the past week, Bitcoin is also flat.
The core consumer price index, which excludes often-volatile food and energy categories, rose 0.2% from a month earlier and increased 2.5% from a year earlier — the slowest pace since March 2021.
Energy and gas prices fell for a second month and grocery prices dropped for the first time since March, according to the print.
The news takes the pressure off Federal Reserve Chairman Kevin Warsh to raise interest rates in September.
Softer inflation data eases the path toward rate cuts, and lower rates reduce the opportunity cost of holding an asset that pays no yield. Bitcoin has typically performed well in a low-interest rate environment.
Sticky inflation in the world’s biggest economy has led the Federal Reserve to take a cautious approach with interest rates. Despite Wednesday’s softer inflation data, prices are still higher
Bitcoin has faced increased volatility since the U.S. and Israel attacked Iran in February, with the leading cryptocurrency dropping hard on initial reports of war. Bitcoin is now down nearly 30% year-to-date.
Still, in recent weeks, investors have shown a growing appetite for the asset. Spot Bitcoin exchange-traded funds in the U.S. have experienced massive inflows — the biggest since April last week — despite negative news for the crypto industry: a massive exploit of the popular Coldcard Bitcoin hardware wallets last month shook crypto investors and a vote on the long-awaited digital asset market structure bill, the Clarity Act, has been delayed.
