Bitcoin Climbs as Inflation Cools—Traders Eye Fed’s Next Move
CPI drops to 2.3%—just enough for Wall Street to pretend it cares about monetary policy again.
Bitcoin’s 2% bump smells like relief rally fuel: Traders bet the Fed might stop pretending inflation is ’transitory’ this time.
Key question: Will Powell pivot faster than a crypto influencer flipping a shitcoin?
Bonus finance jab: Meanwhile, gold bugs still waiting for that hyperinflation apocalypse they’ve been hedging since 2009.
Cooling Inflation Strengthens Rate Cut Hopes despite Tariff Fears
On Tuesday, the Bureau of Labour Statistics reported that the Consumer Price Index (CPI) increased by 2.3% on a year-over-year basis in April, which was below the economists’ expectations of 2.4%. It represented the third straight month of decline in headline inflation. Core CPI, which strips out volatile food and energy prices, was in line at 2.8%.
U.S. CPI: +2.3% YEAR-OVER-YEAR (EST. +2.4%)
U.S. CORE CPI: +2.8% YEAR-OVER-YEAR (EST. +2.8%)
The data arrives as speculation increases over the impact of recent tariffs on Chinese imports on inflation. The wider impact seems to be relatively small so far, with price hikes largely restricted to some household and technology goods.
Impact on BTC Price Today
Bitcoin fell slightly after the announcement but recovered soon to trade at $103,656 with an intraday growth of 1.10%. The cryptocurrency has jumped almost 10% in May 2025 month-to-date, and technical analysts are eyeing $104,000 as a crucial resistance level before it may break new all-time highs at $106,000.
According to the CME FedWatch tool, markets now calculate an 88.6% probability that the Federal Reserve will maintain current interest rates at 4.50% during its June meeting, down from 91.8% before the data release. This shift reflects growing optimism for potential rate cuts later this year.
Meanwhile, U.S. President Donald TRUMP has openly called on the Fed to lower rates as tariffs start to bite the economy, putting unusual political pressure on the central bank. However, recently, Fed Chair Jerome Powell said that policymakers would rather wait and see economic data before they change monetary policy.
Also Read: Miners Profit $10M as Bitcoin price Surges, $109K Coming Soon?
