Bitcoin Hits 79607 as US Inflation Data Surprises
Bitcoin climbed to 79,607 dollars on Friday, defying higher-than-expected US inflation figures and Fed rate hike odds.
Bitcoin traded near 78,749 dollars on Friday, up 2 percent over the previous 24 hours. The asset peaked at 79,607 dollars during New York morning sessions.
This price action occurred after US consumer prices accelerated in August. Core inflation, excluding food and energy, rose 0.3 percent month-over-month. This figure exceeded market expectations.
Inflation Data Defies Market Expectations
US inflation remains sticky due to geopolitical tensions. The conflict with Iran has elevated oil prices. Higher energy costs have increased the price of food, gasoline, and other consumer goods.
Federal Reserve Rate Hike Odds Rise
Higher inflation typically prompts central banks to increase borrowing costs. This dynamic can suppress cryptocurrency valuations. CME FedWatch data shows traders assign an 85 percent probability to higher rates by next week. The Federal Reserve meets next week to set policy.
Bitcoin usually performs well in low-rate environments. Increased liquidity supports demand for non-yielding assets. Federal Reserve Chairman Kevin Warsh stated last month that more work is needed to fight inflation. He has held the position since January.
Regulatory Moves Support Crypto Demand
Bitcoin posted its largest annual gain in years during August. Positive regulatory news drove this rally. Treasury Secretary Scott Bessent announced the department would double long-dated bond buybacks. This move benefits non-yielding assets like bitcoin and gold.
President Donald Trump has urged lawmakers to pass the Clarity Act. He has also pressured the central bank to lower interest rates. The US faces an affordability crisis ahead of midterm elections. Sources include GN auto markets/bonds: interest rates.
