Bitcoin, the world's largest cryptocurrency by market value, has failed to meet the expectations of traders following the release of the latest Consumer Price Index (CPI) data.
The crypto market largely remained indifferent to the CPI figures, disappointing many traders who anticipated a more dramatic reaction.
Crypto trader Josh Rager lamented on Twitter that the movement of Bitcoin was "really disappointing," despite these being "some of the lowest numbers we've seen in a couple of years."
The data showed a slower rise in inflation than economists had projected. The headline CPI rose by only 0.2% in June, bringing it down to 3.0% year-over-year (YoY), according to a tweet by economist Justin Wolfers. This is a return to the inflation level seen in March 2021.
The core CPI, which excludes volatile food and energy prices, also rose just 0.2% and is up 4.8% over the year.Wolfers highlighted that the core CPI increase is even better than it appears, rising only 0.16%, which is approximately half of what Wall Street was predicting.
This lower-than-expected inflation rate leads many experts to suggest that inflation may indeed have been transitory, as suggested by Robert Burgess.
The underwhelming reaction of Bitcoin to the CPI data may also support the theory that Bitcoin, touted as an inflation hedge, may not correlate with inflation as closely as some believe. Despite the muted response, traders like Rager are holding out hope for a late reaction by the cryptocurrency.
Bitcoin, at the time of writing, is trading around $30,732.60, according to data from CoinMarketCap. The cryptocurrency has seen a range between $30,453.09 and $30,904.02 in the past 24 hours.
Whether Bitcoin's price will significantly react to these macroeconomic data points in the future remains to be seen.