US Inflation Falls Below Expectations

In February, the US Core Inflation rate declined from 3.3% to 3.1%, and the US Inflation rate dropped from 3% to 2.8%

The US Core Inflation Rate dropped to 3.1% in February, compared to January’s 3.3%, while the U.S. Inflation Rate fell to 2.8%, compared to the previous month’s 3%. The figures were released by the U.S. Bureau of Labor Statistics on Tuesday.

Core inflation was broadly expected to decrease to 3.2% in February, while the headline inflation was expected to slip to 2.9%.

The persistent drop in inflation rates between January and July 2024 was one of the reasons that encouraged the Federal Reserve to announce a series of interest rate cuts post July.

In July, the interest rate slipped from 5.5% to 5%. In September, it was reduced from 5% to 4.75%. In November, it was lowered to 4.5% from 4.75%.

Will the Fed Cut Interest Rates?

Both the U.S. Core Inflation Rate and the Inflation Rate declined in February, compared to January 2025. It is the first time since July 2024 that both of these indexes have simultaneously dropped. In July 2024, the core inflation slipped from 3.3% to 3.2%, and the inflation rate decreased from 3% to 2.9%.

The development has triggered discussions on Fed rate cuts.

According to reports, the possibility of a rate cut in May has grown from 10% to 31.4%, while the likelihood of a cut by year-end has increased from 6.5% to 32.5%. The chance of four rate cuts this year has surged from 1% to 21%.

Bitcoin Drops Despite Positive Inflation News

The Bitcoin price has decreased by 15.3% in the last 30 days. In the last seven days alone, the price slipped by 9.3%.

Yesterday, the Bitcoin market rose from $82,914.61 to $83,660.58. Currently, the market stands at $83,165.61 — at least 0.59% below yesterday’s closing price.