Why Bitcoin Barely Moved Even as US Inflation Cools to 3.4%

In brief

• U.S. consumer prices rose 0.1% in July after falling 0.4% in June, the Bureau of Labor Statistics said Wednesday.
• Over the past 12 months, prices are up 3.4%, a tick below June's 3.5%.
• Bitcoin ticked up about 0.3% on the day to roughly $63,750, while total crypto market cap slipped under 1%.

U.S. inflation in July slowed as expected, and markets—including Bitcoin—took it in stride.

The Consumer Price Index, or CPI, increased by 0.1% over the last month after falling 0.4% in June, in line with forecasts, the Bureau of Labor Statistics reported Wednesday.

"Over the last 12 months, the all items index increased 3.4 percent before seasonal adjustment," the Bureau said.

Shelter did most of the work. "The index for shelter rose 0.1 percent in July, accounting for roughly two-thirds of the monthly all items increase," the Bureau said. Energy pulled the other way, dropping 1.5% as gasoline got cheaper. Strip out food and energy and prices still rose 0.2% in July after stalling in June, and 2.5% over the year—the gauge the Federal Reserve watches most closely.

Here's the chain traders watch. Cooler inflation is, in principle, a dovish signal: it nudges the Federal Reserve toward lower rates, which makes risky assets like Bitcoin more attractive. So a soft CPI usually lifts crypto.