Bitcoin price rests above $26,200 following key CPI print

The US headline Consumer Price Index (CPI) rose by 3.7% yearly in August, exceeding expectations, and core CPI annual inflation came in at 4.3%, in line with forecasts. Bitcoin price hovers above $26,200, with most of the crypto market noting a minor decline.

The larger-than-expected rebound in prices leaves room for a hawkish message from the Federal Reserve, potentially impacting the decision-making of the FOMC meeting scheduled next week. Higher interest rates could be on the cards, although hikes might not take place soon.

Bitcoin price continued to hover above $26,200, with an initial reaction expected to be bearish, as higher inflation usually translates to lower demand for riskier assets. However, the initial reaction was neutral, with slight bearishness in the past hour. Altcoins showed a similar reaction, with most declines remaining within the 1% mark.

If skepticism of the market rises, Bitcoin price is expected to take a downturn, potentially falling below $24,578 and even declining to $21,468. However, if the market surprises and continues its streak of green candlesticks to breach $26,430, BTC could initiate a recovery rally and invalidate the bearish thesis.