Bitcoin price made small gains after the latest inflation data showed that consumer prices increased at a lower rate than anticipated in April, which was the lowest since early 2021. The king crypto Bitcoin rose above $103,500 after the release of the report as markets digested the implications for Federal Reserve policy.
Cooling Inflation Strengthens Rate Cut Hopes despite Tariff Fears
On Tuesday, the Bureau of Labour Statistics reported that the Consumer Price Index (CPI) increased by 2.3% on a year-over-year basis in April, which was below the economists’ expectations of 2.4%. It represented the third straight month of decline in headline inflation. Core CPI, which strips out volatile food and energy prices, was in line at 2.8%.
The data arrives as speculation increases over the impact of recent tariffs on Chinese imports on inflation. The wider impact seems to be relatively small so far, with price hikes largely restricted to some household and technology goods.
Impact on BTC Price Today
Bitcoin fell slightly after the announcement but recovered soon to trade at $103,656 with an intraday growth of 1.10%. The cryptocurrency has jumped almost 10% in May 2025 month-to-date, and technical analysts are eyeing $104,000 as a crucial resistance level before it may break new all-time highs at $106,000.
According to the CME FedWatch tool, markets now calculate an 88.6% probability that the Federal Reserve will maintain current interest rates at 4.50% during its June meeting, down from 91.8% before the data release. This shift reflects growing optimism for potential rate cuts later this year.
Meanwhile, U.S. President Donald Trump has openly called on the Fed to lower rates as tariffs start to bite the economy, putting unusual political pressure on the central bank. However, recently, Fed Chair Jerome Powell said that policymakers would rather wait and see economic data before they change monetary policy.
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