All news is verified and thoroughly reviewed by leading blockchain experts and seasoned industry insiders.
TL;DR
- US consumer prices fell 0.4% in June, easing immediate fears of another Fed rate hike.
- Bitcoin briefly reached $65,500, while Ethereum rose above $1,900 before both surrendered part of the rally.
- Renewed hostilities between the United States and Iran and a sharp decline in traffic through the Strait of Hormuz have brought a renewed focus on energy and inflation risks.
Bitcoin has moved from around $62,600 before the latest US inflation report to a monthly high near $65,500, back towards the $63,000-$64,000 area as geopolitical pressures resurface. Ethereum followed the same pattern, rising from below $1,800 to nearly $1,945 before falling back to the mid-$1,800s.
The reversal wasn’t just a failed rally in cryptocurrencies. Markets spent the past week moving between two competing macroeconomic signals: slowing inflation in the United States and an escalating conflict that could push energy prices higher again.
The CPI rise contained its own Achilles heel
the The US Consumer Price Index fell 0.4% in June After rising 0.5% in May, marking the largest monthly decline since April 2020. Core inflation, which excludes food and energy, was unchanged during the month and rose 2.6% from a year earlier.
The report lowered expectations that the Federal Reserve would need to raise interest rates at its July meeting. Bitcoin rose above $64,000 after the release, while Ethereum gained more than 6% during the session and held above $1,900 the next day.
The combination of low inflation has introduced an important constraint. Energy prices fell 5.7% in June and were the largest contributor to the lower headline reading. This means that part of the relief depends on cheaper fuel, the same component now threatened by renewed instability in the Middle East.
Hormuz brings energy risks back to the market
The crypto rally weakened as the US and Iran exchanged more attacks and shipping activity through the Strait of Hormuz fell sharply.
according to Shipping data reported by ReutersOnly three cargo ships passed through the strait on July 16, the lowest daily number since May. Neither large crude oil tankers nor liquefied natural gas tankers completed the passage for the second day in a row.
Transit has not been officially stopped for all shipping. The renewed US blockade has targeted Iranian ports and Iran-related traffic, while neutral ships traveling to and from other countries have not been officially banned from using the strait. However, the collapse in activity showed that operators were not prepared to treat the route as usual.
Cryptocurrencies are linked through oil, inflation, and monetary policy. A continued increase in energy prices could reverse some of the improvement in inflation in June, reduce the room available for the Federal Reserve to ease policy and boost demand for cash on speculative assets.
Bitcoin is stuck between two macro signals
Bitcoin’s decline towards $63,000-$64,000 did not erase the entire post-CPI rebound, but it did show that weaker inflation alone was not enough to support a sustained breakout. Ethereum’s return below $1,900 delivered the same message more clearly as it gave up most of its initial 6% advance.
Now the market is balancing the confirmed drop in inflation in June with the energy shock that has not yet appeared in official consumer price data. This leaves oil prices and shipping conditions through Hormuz as immediate variables before the event Federal Reserve meeting on July 28-29.
A return above Bitcoin’s Wednesday high near $65,500 suggests that inflation-driven demand has weathered the geopolitical downturn. A drop below the pre-report area of around $62,600 would instead show that the market has fully surrendered to the rising CPI.
