tl;dr
Bitcoin rose 0.5% to $119,000 and Ethereum gained over 5% to $4,400 after July U.S. CPI data showed a 0.2% monthly increase and 2.7% annual headline inflation, with core CPI up 0.3% monthly and 3.1% annually. The mixed inflation data indicated slowing headline inflation but persistent core inflation...
Bitcoin rose 0.5% to $119,000, while Ethereum gained more than 5% to $4,400 following the release of July U.S. CPI data. The Consumer Price Index showed a 0.2% month-over-month increase and a 2.7% annual rate, with core CPI up 0.3% monthly and 3.1% annually. This mixed inflation profile indicated a deceleration in headline CPI from 0.3% in June to 0.2% in July, though the annual rate held steady at 2.7%. Meanwhile, core CPI increased on a yearly basis, rising to 3.1% from 2.9%, signaling persistent inflation pressures in the core services category.
The actual CPI outcomes matched consensus expectations for monthly headline and core gains, came in below consensus for the annual headline rate, and exceeded expectations for core annual inflation. Crypto markets responded positively, with Bitcoin climbing back toward the upper end of its recent trading range and Ethereum continuing its strong performance for the day. This price action mirrored typical high-impact economic data releases, where liquidity concentrates around release times and order books thin, leading to immediate but focused market moves.
From a macroeconomic perspective, the data suggests a narrow policy path for the Federal Reserve. The slower monthly headline CPI easing near-term inflation pressures from energy and goods contrasts with the persistent 3.1% annual core inflation figure, which keeps attention on services and shelter costs. Markets have generally interpreted this balance as headline inflation influencing broad risk appetite, while core inflation shapes expectations for the Fed’s future policy steps.
Derivatives markets amplified the initial reaction to the CPI report, with Bitcoin and Ethereum capturing the majority of immediate flow adjustments, while other assets lagged. The July CPI report adds to a sequence of mid-year data points that investors will weigh alongside forthcoming labor and consumer spending figures to gauge economic momentum.
For cryptocurrency investors, the headline takeaway was clear: Bitcoin regained momentum near $120,000, and Ethereum extended its rally to $4,400 following the inflation data, reflecting confidence in crypto’s resilience amid mixed macroeconomic signals.