Bitcoin Price Prepares for a Rise as BoE Rate Cut Speculation Increases with the Fall in UK Inflation
The UK's inflation rate has recently fallen to 2%, meaning the Bank of England has hit its target for the first time in three years.
This important development increased speculation that the Bank of England may reduce interest rates later this year.
Such a rate cut could have serious impacts on the cryptocurrency market, increasing adoption and prices.
UK Inflation Reached Central Bank Target
The UK reported a 2% inflation rate for the first time in nearly three years, aligning with the Bank of England's long-term target. This fall in inflation has sparked discussions about a possible interest rate cut by the Bank of England in the coming months. If the central bank decides to cut interest rates, this could encourage cryptocurrency adoption and positively impact asset prices.
Analysis of Latest Inflation Data
The UK Consumer Price Index (CPI) is up 2.0% annually through May 2024, falling from 2.3% in April, latest data shows. This marks the slowest inflation rate since July 2021. Analysts hope this trend will lead the Bank of England to consider lowering interest rates.
On a monthly basis, CPI rose 0.3% in May, slightly below the 0.4% previously forecast. According to the Office for National Statistics, the main downward pressure on inflation has come from the decline in food prices, which saw significant increases last year. In contrast, motor fuel prices were the factor creating the greatest upward pressure and recorded small increases compared to last year's decline.
