Bitcoin recovers from CPI dip as US inflation holds at 3.4%

Bitcoin dipped toward $76,000 as underlying price pressures in the US appeared slightly higher than expected in the last US inflation report.

No wider crypto sell-off followed, and Bitcoin jumped back above $77,000, while Ethereum and some larger altcoins remained higher during the session.

US inflation remains above the Fed’s target

The Consumer Price Index increased 0.4% in August, according to the US Bureau of Labor Statistics, higher than July’s 0.1% increase and in line with economists’ forecasts.

Inflation remained at 3.4% year-on-year.

The core inflation measure, which excludes volatile food and energy costs and is regarded as a better gauge of underlying price pressures, rose 0.3% during the month, but most economists had anticipated a slimmer 0.2% increase.

Core inflation, however, had fallen from 2.5% to 2.4%.

Gasoline prices represented over one-third of last month’s increase, soaring 3.9% and pushing the broader energy category up 2.1%.

Housing costs rose 0.3%, while food prices increased by 0.1%.

Bitcoin sees sharp but temporary reaction

Bitcoin initially dropped to approximately $76,050 after the report was released, but then recovered and traded above $77,100 at the time of writing.