Bitcoin was impacted by the latest U.S. CPI release, but the reaction is a little complicated.

The August CPI, released September 11, showed:

🇺🇸 Headline CPI: 3.4% YoY, exactly as expected

Core CPI: 2.4% YoY, down from 2.5%

Core CPI monthly: +0.3%, hotter than the 0.2% expected �

Reuters +1

Why BTC reacted

Initially, Bitcoin dropped roughly $1,000 immediately after the CPI announcement, then recovered above $77,000. �

CryptoPotato

The problem for BTC is that the 0.3% monthly core CPI was hotter than expected. That increased expectations that the Fed could keep rates higher or even raise rates, which is generally bearish for risk assets like Bitcoin. Markets were pricing roughly an 85–87% probability of a Fed hike after the report.