Bitcoin Surges as US Inflation Eases
Our editorial content is meticulously reviewed by leading industry experts and seasoned editors to ensure the highest standards of accuracy and reliability. Ad Disclosure
Bitcoin Reaches New Heights Amidst Cooling US Inflation
Earlier today, Bitcoin (BTC) experienced a notable surge, momentarily surpassing the $110,000 threshold. This uptick followed the release of unexpectedly favorable data from the US Consumer Price Index (CPI). The latest figures suggest a diminishing inflation rate, bolstering the argument for the US Federal Reserve (Fed) to consider reducing interest rates. Such a move is likely to favor risk-prone assets, including Bitcoin.
Advertisement Banner
US CPI Data Indicates Continued Inflation Decline
The US Bureau of Labor Statistics unveiled the May 2025 CPI report today, clearly indicating a downward trend in inflation. Both headline and core CPI readings were below the predictions made by economists.
In detail, the headline CPI increased by a modest 0.1% in May, falling short of the anticipated 0.2%. On a year-over-year (YoY) basis, the headline CPI recorded a 2.4% rise, slightly under the projected 2.5% and above the 2.3% seen in April. Meanwhile, core CPI, which excludes volatile elements such as food and energy, also saw a 0.1% increase, contrasting with the predicted 0.3%. The April figure was 0.2%. Annually, core CPI stood at 2.8%, just below the expected 2.9%.
Following the inflation report, Bitcoin experienced moderate gains, rising by 0.6% and briefly hitting the $110,000 level before slightly retreating. This data has fueled expectations of a potential Fed rate cut in the foreseeable future.
According to the Chicago Mercantile Exchange (CME) FedWatch Tool, market participants are currently anticipating two rate reductions in 2025, with the first anticipated in September and the second in December.
Bitcoin is also poised to benefit from decreasing geopolitical tensions. US President Donald Trump announced today that a trade agreement with China “is finalized,” further enhancing investor confidence.
Technical Analysis Shows Potential for Bitcoin Breakout
Crypto analyst Titan of Crypto has pointed out a promising golden cross developing on Bitcoin’s weekly chart. In a social media post, the analyst shared a chart highlighting the significance of Bitcoin maintaining a position above the $109,000 level to confirm a potential breakout.
A golden cross is a bullish technical indicator that occurs when a short-term moving average (MA), typically the 50-day, crosses above a long-term MA like the 200-day. This crossover is often interpreted as a sign of potential momentum shift and a sustained upward trend.
Favorable Macroeconomic Factors Support Bitcoin Rally
Beyond the easing inflation, several macroeconomic factors are bolstering a positive outlook for Bitcoin. Historically, Bitcoin has been observed to follow the M2 money supply, and an increase in global liquidity could contribute to further price gains.
Some experts are drawing comparisons between Bitcoin and gold. Crypto analyst Ted Pillows recently projected that Bitcoin might reach $130,000 by the third quarter of 2025, paralleling gold’s performance during inflationary periods.
Crucially, the current Bitcoin market lacks signs of overheating. Unlike previous bullish cycles, this phase does not exhibit retail-driven mania, indicating that substantial upside potential may still exist. As of the latest update, Bitcoin is trading at $109,876, marking a 1% increase in the past 24 hours.
Our Editorial Commitment
Our editorial process at Bitcoinist is dedicated to delivering thoroughly researched, accurate, and unbiased content. We adhere to strict sourcing standards, and each article undergoes meticulous review by our team of top technology experts and seasoned editors. This rigorous process ensures the integrity, relevance, and value of our content for our readers.
“`
This rewritten content not only maintains the essential information but also enhances readability and SEO compatibility through structured HTML headings and enriched language.
