Bitcoin Rallies Past $114,000
Bitcoin (BTC) surged to $114,471.65 on September 11, bouncing back from a weekly low near $110,000. This marks its highest level so far this month and signals renewed investor confidence after weeks of muted price action.
The rally coincided with $757 million in net inflows into Bitcoin ETFs on September 10, reversing last month’s outflows. Market participants appear to be positioning for a more dovish Federal Reserve following a shift in U.S. economic data.
Inflation Decline Fuels Fed Rate Cut Bets
The U.S. Bureau of Labor Statistics reported a surprise 0.1% drop in the Producer Price Index (PPI) for August, defying expectations of a 0.3% increase. This unexpected cooling suggests that inflationary pressures are easing, bolstering risk assets like Bitcoin.
Investors are now betting heavily that the Fed will cut interest rates at its next meeting. According to Polymarket, traders assign a 78% probability to a 25 basis point cut and a 20% chance to a larger 50 basis point reduction.
CPI Data Looms as Key Test
While the PPI report sparked optimism, the upcoming Consumer Price Index (CPI) release will serve as the ultimate test for market sentiment. CPI is the Fed’s preferred inflation gauge, and a soft reading could cement the case for aggressive rate cuts.
Until then, Bitcoin traders are closely watching macroeconomic developments, with many expecting volatility to continue as the market digests shifting expectations.
