Bitcoin flirts with $30,000 post-CPI data

More traders are expected to purchase Bitcoin at steep discounts as they wait for forward-looking macroeconomic data to indicate a recovery in the cryptocurrency’s price since social volume for Bitcoin has increased over the past 30 days.

High inflation rates in a nation increase the value of its currency, whereas lower inflation rates encourage greater inflows of foreign money. The stability and expansion of the cryptocurrency market depend on the Federal Reserve’s attempts to decrease liquidity.

The US Consumer Price Index recorded a 3.2% increase in inflation in July, slightly below market expectations of 3.3%. This reading is uncertain as the Fed is reducing liquidity, which could impact the direction of risk assets like Bitcoin and altcoin prices.

The CPI is a widely used measure of inflation, and the July reading indicates that the Fed has been effective in reducing liquidity in the system. Bitcoin traders are likely to scale up their exposure to risk assets, as the July CPI data is slightly below consensus.

This could lead to the Fed staying hawkish for a while, introducing downside volatility to risk assets like Bitcoin.