The Bitcoin price rose following the release of U.S. inflation data revealing a 2.8% increase in CPI for February, lower than expected. Core inflation decreased to 3.1%, signaling positive trends. As the Fed monitors economic impacts, traders now anticipate multiple interest rate cuts by year’s end.

On Wednesday, the price of Bitcoin surged following the release of U.S. inflation data, showing consumer prices rose less than anticipated. According to the Bureau of Labor Statistics, the Consumer Price Index (CPI) for the year ending in February increased by 2.8%, which is below economists’ expectation of 2.9%.

Core inflation, excluding food and energy prices, rose to 3.1%, a decrease from January’s 3.3%. This figure, used to assess underlying inflation trends, is also slightly lower than what economists projected, indicating a positive shift in inflation rates.

President Trump’s fluctuating stance on tariffs has contributed to market volatility, yet the latest CPI data suggests inflation has eased compared to last September’s 2.4% annual increase. On this news, Bitcoin rose to $84,000, marking a 1% increase within just 10 minutes, while Ethereum and Solana also saw gains.

The Federal Reserve is closely observing how Trump’s policies might impact inflation efforts. Fed Chair Jerome Powell noted that uncertainties regarding these changes remain high. Recently, Trump expressed encouragement regarding the declines in egg and gasoline prices on Truth Social.

Market expectations indicate that the Fed is likely to maintain interest rates at their upcoming policy meeting. Recent trading activity forecasts three potential rate cuts by year-end, a significant increase in expectations compared to just one predicted a month prior.

In summary, Bitcoin’s price increase reflects positive developments in U.S. inflation metrics, with CPI data revealing a lower rate of price growth than anticipated. Core inflation also showed improvement, suggesting a favorable economic outlook that has impacted cryptocurrency valuations. Market participants are now anticipating the Federal Reserve’s response to these developments and adjustments in interest rate policies.

Original Source: decrypt.co

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