Goldman Sachs analyst has a surprising response to inflation data originally appeared on TheStreet.
Bitcoin slipped on Friday moments after inflation data confirmed a stickier pricing environment. The United States' Core PCE Price Index escalated to 2.7% year-over-year in May, slightly surmounting the projected 2.6% and up from April's revised 2.6%.
The broader PCE index also rose to 2.3%, consistent with predictions. Despite the modest beat, the dollar weakened sharply, and crypto traders took notice.
Likely due to the inflation rise, Bitcoin lingered between $106,730 and $106,955 in the interval following the news. However, the asset's 24-hour high approached $107,973.65, as of June 27.
While volume remained strong at over $43 billion, demonstrating continued substantial interest from major financial players, the response was not overwhelmingly positive or negative.
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Analysts weigh in on new inflation data
More telling than the minute movement was the larger economic environment. The value of the United States dollar index dipped 0.25% to 97.10, with a year-to-date decline of over 10%.
Traditionally, a weaker dollar has correlated with higher prices for riskier holdings, and Bitcoin is increasingly viewed as a safeguard against both inflation and the erosion of the dollar's value.
Fueling the narrative further was data showing personal income fell 0.4% while individual expenditures dropped 0.1%, indicating strain on consumer pocketbooks.
On June 18, Gurpreet Garewal of Goldman Sachs Asset Management said:
"We don't believe the dollar is on the verge of losing its status as the world's reserve currency. So, while the dollar's dominance may be diminished, it is far from finished."
US core CPI and PCE trends in 2025 show inflation rebounding toward historical norms. Source: BLS, BEA and Brook's X. On June 27, Robin Brooks, Chief FX Strategist at Goldman Sachs, also mentioned on X that post-COVID inflation measures, such as CPI and PCE, have been skewed by residual seasonality. CPI and PCE both over-measured inflation in the first part of the year and are now under-measuring it.
Brooks said, "This low-flation period is ending now."
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As the dollar loses strength, global demand for alternative stores of value may rise. At press time, the global crypto market stands at $3.27 trillion, down by 0.25%. Crypto markets may again attract inflation-seekers as macro volatility returns.
Goldman Sachs analyst has a surprising response to inflation data first appeared on TheStreet on Jun 27, 2025
This story was originally reported by TheStreet on Jun 27, 2025, where it first appeared.
