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Bitcoin surpassed $114,000 on Thursday, resulting in a 2% increase in the overall cryptocurrency market capitalization as traders positioned themselves in anticipation of a significant US inflation report.
The Bureau of Labor Statistics is scheduled to publish the August Consumer Price Index data on Sept. 11 at 8:30 AM Eastern Time. These figures are particularly crucial for digital assets, as investors are closely monitoring whether the Federal Reserve will lower interest rates during its meeting on Sept. 16-17.
Economists surveyed by FactSet predict that consumer prices will increase by 0.3% month-over-month and 2.9% year-over-year for August. Core inflation, which excludes food and energy prices, is expected to be at 3.1% annually.
Bitcoin Spot ETFs Record $757M In Net Inflows
A weaker-than-anticipated reading could increase pressure on the Fed to reduce rates by as much as half a percentage point. Such a decision would likely weaken the dollar, draw funds away from bonds, and direct capital into riskier assets such as cryptocurrencies and stocks.
The cryptocurrency markets responded promptly. Ethereum increased by 2% to $4,401, while altcoins like Solana, BNB, and Hype outperformed, with BNB and Hype reaching all-time highs.
Spot exchange-traded funds also experienced significant inflows. On Sept. 10, Bitcoin spot ETFs noted net inflows of $757 million, marking the third consecutive day of positive inflows. Ethereum ETFs attracted $172 million, with BlackRock’s ETHA contributing $74.5 million alone.
On September 10, Bitcoin spot ETFs recorded total net inflows of $757 million, marking the third consecutive day of net inflows. Ethereum spot ETFs saw total net inflows of $172 million yesterday, with BlackRock’s ETHA leading at $74.5 million. https://t.co/Hj2Gs49bWa pic.twitter.com/NhGerFAkyO
— Wu Blockchain (@WuBlockchain) September 11, 2025
Rate Cut Expectations Increase Despite Officials’ Caution
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Market participants indicate that momentum has been building since the inflation report in July, which pointed to easing price pressures. A rate cut would continue this trend, although Fed officials remain cautious. Minutes from the last policy meeting highlighted concerns regarding slowing job growth and inflation driven by tariffs, while also cautioning that asset prices were already high.
Federal Reserve Chair Jerome Powell, who has resisted repeated requests from President Donald Trump for more aggressive cuts, acknowledged at Jackson Hole that conditions “might justify” easing.
Traders currently view the upcoming CPI release as the final data point before next week’s policy decision.
Producer Prices Decline, Heightening Hopes For Cooling Inflation
Producer price data released earlier indicated an unexpected decline in August, attributed to lower service costs. This further enhanced expectations that inflation is subsiding.
The outcome will have implications beyond Bitcoin. Ethereum and other Layer-1 networks have been responsive to changes in US monetary policy, while altcoins often experience more pronounced movements during liquidity rotations. A dovish Fed would likely prolong the rally across the board.
Conversely, a stronger-than-expected CPI reading could postpone or limit the extent of rate cuts, moderating the recent cryptocurrency rally.
For the time being, the cryptocurrency market is trading as if relief is imminent, with investors wagering that a Fed pivot could maintain record-high valuations in the upcoming months.
The post Bitcoin Breaks $114K, Crypto Market Cap Climbs Ahead Of US Inflation Data appeared first on Cryptonews.
