ETH Price Bounces as Inflation Rate Falls Below Expectations
Ethereum traders are pinning their hopes on a sustained rally towards $3,400 after the Federal Reserve's preferred inflation measure came in below expectations. The Personal Consumption Expenditures price index showed annual inflation of 3.4%, approximately 0.3 percentage points below the consensus.
The improvement in sentiment coincided with encouraging onchain indicators and growing attention to Ethereum's upcoming Glamsterdam upgrade. However, analysts anticipate further consolidation, potentially including a retreat towards $2,500 before a sustained move higher.
The probability of a 25-basis-point increase at the next Federal Reserve meeting fell from 68% to 37%, according to FedWatch figures. This shift makes a hike less likely in market pricing, but it does not rule one out. Subsequent inflation and employment figures could still alter expectations.
The positive reading of Santiment's 365-day Market Value to Realized Value indicator moving above zero for the first time since July 2025 suggests improving market conditions after an extended weaker period. However, a failed retest or renewed macroeconomic pressure would weaken the scenario of a rally towards $3,400.