Bitcoin (BTC) traders are watching the July 14 US inflation report, with analysts at crypto trading firm BIT saying it could determine the cryptocurrency’s next move as markets price in 2.6 Fed rate hikes over the coming quarters.
The inflation data is also coming at a time when BTC has steadied after recent volatility, leaving macroeconomic signals in greater control of short-term price direction.
CPI Report Takes Centre Stage for Bitcoin
According to BIT’s latest market update, since the last rate cut outlook that helped lift Bitcoin during the early stages of its fifth bull market in 2023, expectations have changed, with investors increasingly pricing in tighter monetary policy since September 2025, which creates a more difficult backdrop for risk assets, including crypto.
The firm’s report also pointed to comments made this week by Federal Reserve Governor Christopher Waller that policymakers are at a crossroads, something it interpreted as making the current environment more hawkish than before. It also suggested that the inflation reading could quickly change prospects around BTC.
“Tonight’s CPI report is critical for Bitcoin,” read the update. “An inflation reading above 4.0% would likely reinforce expectations for further tightening and add to downside pressure.”
Recall that in the last FOMC meeting, rates were held at 3.50% to 3.75%. However, as minutes from the meeting revealed, there was a divide among officials on future hikes. Some of them, as pointed out by BIT, raised concerns about AI-induced inflation. Furthermore, the latest survey by the New York Fed estimated one-year inflation expectations to be 3.7%, which was the highest since September 2023 after May’s CPI reached a 3-year high of 4.2%.
Bitcoin is coming into the above setup trading near $63,000, having seen very little change in 24 hours but down by about 1% in the last week, with July historically seen as a green month for the OG cryptocurrency.
And it showed signs of that tendency after it recovered from a low near $58,000 to briefly climb above $64,000 before giving back parts of those gains as renewed hostilities between the US and Iran wrecked havoc in the market.
Not Everyone Is Convinced By July’s Seasonal Boost
Despite the rebound, CryptoQuant’s Bull Score Index is at 30, which is still firmly in bearish territory, and analysts have said that it needs a reading above 60 before any rebound counts as more than a bear-market bounce.
In addition, as BIT noted, the US-Iran conflict is not the only negative development Bitcoin has faced, as it also absorbed Strategy’s recent disclosure that it sold 3,588 BTC to fund dividend payments with little impact. It did dip by about $1,000 after the Strategy announcement, but recouped those losses within hours, which, according to the investment firm, suggested that much of the selling had already been anticipated by the market.
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