US consumer prices saw a 2.7% increase over the past year, mirroring June’s pace. Shelter costs drove this surge, accounting for the largest monthly gain. Food prices remained largely unchanged, with modest fluctuations in restaurant meals and grocery bills. Energy prices fell, particularly gasoline, dropping by 2.2%. The core CPI, excluding volatile food and energy components, rose 0.3% on a monthly basis, after a 0.2% increase in June. Annual core inflation reached 3.1%, slightly higher than the previous month’s 2.9%. Medical care, airline fares, recreational activities, household furnishings, and used vehicles all saw increased prices, while lodging away from home and communication experienced declines. However, price pressures remain persistent within core categories. Market predictions now anticipate a 0.25% Federal Reserve rate cut in September. This shift comes with a significantly higher likelihood (87%) compared to last month’s 57%. Bitcoin could see renewed upward momentum if the Fed cuts rates next month. Lower borrowing costs often increase liquidity and investor appetite for risk assets. However, persistent core inflation exceeding 3% may strengthen Bitcoin’s appeal as a hedge, potentially pushing it towards $125,000 before year-end. Analysts warn that stubborn inflation could prompt more cautious Fed decisions, leading to volatility in crypto markets. If this occurs, Bitcoin might experience short-term pullbacks before resuming any sustained upward rally. As of the time of writing, BTC is trading around $118,500 after a 1.9% decline over the last 24 hours.