Bitcoin Nears $65,000 on Softer Inflation Data as Geopolitical Tensions Limit Upside

Bitcoin's price climbed toward $65,000 on Wednesday, reaching a three-week high after a U.S. inflation report came in softer than anticipated. However, escalating military tensions between the U.S. and Iran kept the rally in check, creating a cautious tone across risk assets.

Inflation Data Fuels Crypto Rebound

Bitcoin rose 3.7% to $64,938.1 by 02:00 ET (06:00 GMT), briefly touching an intraday high of $65,055—its highest level since June 22, according to Investing.com. The move extended gains from the previous session, driven by a U.S. consumer price index (CPI) report that was weaker than expected.

This data eased investor concerns about an imminent interest rate hike from the Federal Reserve. Higher interest rates typically weigh on non-yielding assets like cryptocurrencies by increasing the opportunity cost of holding them compared to government bonds.

Geopolitical Risks and Fed Policy Cap Gains

Despite the positive inflation news, significant gains were limited by ongoing geopolitical uncertainty. The source material reported that the U.S. and Iran exchanged military strikes early Wednesday, with U.S. President Donald Trump stating that strikes would continue until a deal is reached. Iran reportedly retaliated against U.S. bases and threatened key shipping channels.

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The conflict sent oil prices surging, reigniting market concerns over an energy-driven resurgence in inflation. These fears were compounded by recent comments from Federal Reserve Chair Kevin Warsh, who reiterated the central bank's commitment to its 2% annual inflation target, signaling that a hawkish policy bias remains in place.

Altcoins Follow Bitcoin Higher

The positive sentiment spread to the broader cryptocurrency market, with major altcoins also posting gains. The rebound provides some relief for a sector that has faced waning investor appetite this year amid a broader market rotation into other asset classes like artificial intelligence stocks.

Key altcoin movements included:

• Ether (ETH): Rose 5.8% to $1,886.86.
• XRP: Gained 3.8% to trade at $1.1101.
• Solana (SOL) and Cardano (ADA): Advanced 4.4% and 3.6%, respectively.