Bitcoin Climbs After US Inflation Hits More Than Three-Year High

Bitcoin erased intraday losses and rose about 2.5% to $62,410 after the US inflation report, even as the headline Consumer Price Index hit its highest level in more than three years. The US CPI rose 4.2% year over year in May, with headline inflation up 0.5% month on month and core inflation — which excludes food and energy — up 2.9% annually and 0.2% monthly.

The headline jump was driven largely by higher energy and gasoline prices, as renewed Middle East tensions lifted oil prices and reignited inflation concerns. At first glance the report looked bearish for Bitcoin: higher inflation typically reduces the odds of Federal Reserve rate cuts, keeps Treasury yields elevated and tightens financial conditions, pressuring risk assets.

Bitcoin rallied because the print did not come in worse than feared. Economists had expected headline CPI to hit 4.2%, removing the risk of a hotter surprise, and traders did not see the report as strong enough to force a tougher Fed stance.

United States

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