US Inflation Hits Three-Year High, Putting Pressure on Crypto and Gold

Analysts are warning that Bitcoin and gold may face further pressure as US inflation topped 4% in May, according to figures released on Wednesday.

The surge in the Consumer Price Index (CPI) deflated hopes of a rate cut by the central bank, with some analysts now expecting rate hikes later this year - bad news for riskier assets like crypto.

Bitcoin has already had a rough first half of the year, falling 36% since January while gold is down 23% from its January peak. In contrast, crude oil prices have surged over 50% during the same period.

'Today's in-line CPI print keeps the Fed cautious, data-dependent, and in no rush to cut,' said Iggy Ioppe, chief investment officer at Theo.

Markus Thielen of 10x Research also sees the current macro environment as a continued headwind for Bitcoin, predicting that breaks below $60,000 are 'increasingly likely' over the coming days.