The U.S. Bureau of Labor Statistics has reported a drop in August’s Consumer Price Index (CPI) inflation rate to 2.5%, falling below the expected 2.6%. This marks the end of a 40-month streak where inflation stayed at or above 2.9%, and it’s the fifth month in a row of declining CPI inflation.
The drop in inflation signals a change in the financial sector, with inflation finally easing. As a result, Bitcoin’s price has surged above $57,000 after previously struggling with a price drop.
Cooling US CPI Inflation Data
The latest August month U.S. CPI inflation rate has dropped to 2.5%, down from 2.9% in July and 3.0% in June, showing a steady cooling of inflation over the past year. The actual figure of 2.5% came in slightly below expectations, signaling a continued decline in inflation.
Meanwhile, the reduction marks five consecutive months of declining inflation, suggesting a steady cooling trend. Economists believe this may increase the likelihood of a rate cut in September, offering relief to markets and investors.
Core CPI Inflation
The core CPI inflation, which excludes volatile items such as food and energy, also dropped to 3.2%, slightly below the expected 3.3%. The ongoing drop in both overall and core CPI shows that past efforts to control inflation are starting to work.
If this trend continues, it could lead to a more stable economy soon, giving hope for lasting improvement.
Bitcoin Price Sees a Boost
Following the release of the CPI data, Bitcoin’s price surged by 1.02%, reaching $56, 940 with a market cap of $1.12 trillion. The cryptocurrency appears to be gaining momentum, with the potential to break the $60,000 resistance level. This price movement suggests that investors are holding onto their positions, anticipating further gains, rather than opting to book profits.
If inflation continues to ease, Bitcoin and other cryptocurrencies could see more significant upward trends soon.
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