On Thursday, bitcoin dropped to around $63,500, down more than 0.5% for the day and nearly 2% for the week, as U.S. inflation data that met expectations proved sufficient to calm concerns but not enough to influence the market.
The top performer was Hyperliquid (HYPE), which gained over 3% to $56, though it remained flat for the week. Tron edged up slightly to just under 34 cents and rose 2% for the week. All other assets declined. Dogecoin fell nearly 3% to 7 cents, XRP dropped over 1% to $1 and fell nearly 5% for the week, BNB was down over 1% to $610, Solana fell less than 1% to $76, and Ethereum dipped slightly to $1880.
July's data came in almost exactly in line with economists' expectations. Headline inflation rose 0.1% month-over-month and 3.4% year-over-year, with the core measure, excluding food and energy, rising 0.2% and cooling to 2.5%.
This was enough to lower the probability of a Federal Reserve interest rate hike in September, which futures markets cut to roughly 38% from 46% ahead of the release. Gold surged 1.3% immediately after, Ethereum rose a bit over 1%, bitcoin gained about 0.5%, and S&P 500 futures advanced 0.2%.
Gabe Selby, Head of Research at CF Benchmarks, stated that bitcoin exhibits its strongest gains when inflation data forces a reassessment of interest rates, averaging 3.25% for 3 of the last 9 times inflation came in lower than expected.
An unexpected drop on July 14 was followed by a 4.24% gain.
"An in-line report can take out the tail-risk," Selby said. "It requires a genuine surprise to create a catalyst."
He also believes the Fed should wait, as housing costs rose just 0.1%, energy fell 1.5%, and gasoline dropped 2.9%, with some goods categories having already surpassed last year's tariff-driven increases.
The next tests will be the Jackson Hole bankers' meeting later this month, the September 4 employment report, and the September 11 inflation data release.
Stocks took the news better. The MSCI Asia Pacific index gained almost 1%, with Samsung Electronics and SK Hynix contributing the most, and South Korea's Kospi jumped nearly 4% amid a technical bull market, having risen 22% in 10 days.
Sentiment was mixed: Cisco shares fell more than 4% after hours on disappointing financial results, and Cerebras Systems stock dropped 17% due to declining hardware sales.
Brent crude snapped a 6-day winning streak, falling after a period where its price reached $90 per barrel. This came after Islamic Revolutionary Guard Corps advisor General Mohammad Reza Naqdi stated that Iran is preparing to conduct operations on U.S. soil as part of a new military doctrine.
