US Inflation Crushes Hopes for Fed Rate Cut, Weighs Heavily on Bitcoin

The outlook for Bitcoin has darkened after US inflation data revealed little support for a near-term Federal Reserve rate cut, according to CoinShares. The firm stated that crypto investment flows turned negative as investors reassessed their expectations for easier monetary policy.

Consumer prices rose in line with forecasts, while core inflation came in slightly hotter than predicted, reducing hopes for near-term easing and adding pressure on risk-sensitive assets such as Bitcoin.

The negative impact was reflected in the global digital asset ETP flows, which turned negative this week. At the same time, Treasury pressure is building as bond buybacks struggle to bring long-term yields down.