Bitcoin Tumbles Below $108K as Inflation Fears Spark Rate Cut Uncertainty

Bitcoin's price has dropped below $108,000, prompting questions about its potential to fall further. The latest US inflation data shows core inflation climbed 2.9% year-over-year in July, which may limit the Federal Reserve's ability to cut interest rates aggressively.

The market assigns an 87.6% probability of a 25bps rate cut at the September FOMC meeting, but risk appetite is fragile and crypto markets are reacting more sensitively to macro data than earlier this year.

Analysts point out that whale distributions and liquidations of leveraged positions accelerated the decline over the weekend.