Bitcoin Price Rises Above $85K After US Core PCE Inflation Comes In Below Expectations

WHY IT MATTERS

Inflation measures how fast prices for everyday goods and services are rising. The Core PCE index is a specific way the US government tracks inflation, and it is the one the Federal Reserve (America's central bank) pays the most attention to. Think of the Federal Reserve like a thermostat for the economy — when inflation runs too hot, it raises interest rates to cool things down, and when inflation cools, it may lower rates. Higher interest rates tend to make riskier investments like crypto less attractive because safer options like savings accounts and bonds offer better returns. So when inflation data comes in lower than expected, as it did here, some investors view it as a potentially favorable environment for assets like Bitcoin. This is why crypto markets sometimes react to economic data releases that might seem unrelated to digital currencies at first glance.