Bitcoin Rebounds to $79,000 as CPI Data Meets Expectations
Bitcoin climbed above $79,000 after US inflation data matched forecasts. The 30-year Treasury yield briefly hit a 22-year high.
Bitcoin rebounded past $79,000 following the release of August Consumer Price Index data. The asset gained more than 3% on the day after dipping to $76,000. US equities mirrored this recovery, with the S&P 500 rising 1% and the Nasdaq gaining 1.1%.
The 30-year US Treasury yield spiked to its highest level since June 2004 before settling at 5.309%. This volatility occurred despite core CPI rising 0.3% in August, a figure slightly above analyst expectations. The market interpreted the data as confirming persistent inflationary pressures.
Inflation drivers and energy costs
Gasoline prices rose 3.9% in August, contributing significantly to the overall index increase. Energy costs climbed 2.1% over the same period. These figures reflect the impact of supply constraints linked to geopolitical tensions and oil prices near $100 per barrel.
Federal Reserve rate hike expectations
Traders increased the probability of a Federal Reserve interest rate hike to 85%. This shift occurred from a 60% chance just one week prior. The market now expects a 0.25% increase at the September 16 meeting, signaling a hawkish stance on policy.
Bond yields challenge crypto narrative
QCP Capital warned that high yields undermine the Bitcoin bull case. The firm noted that rising yields driven by policy tightening lack the nominal growth impulse that typically supports assets. This dynamic conflicts with the recent narrative of structural liquidity support for the crypto market.
