A soft U.S. inflation report is expected to be released, which could benefit risk assets such as bitcoin. However, the report may not result in a significant bullish movement for bitcoin. The data could lead to expectations of further Federal Reserve interest rate cuts, which could lower Treasury yields and weaken the dollar index, thus boosting demand for riskier assets. Despite this potential boost, it is unlikely to be the sole catalyst for a breakout in the price of bitcoin. Forward-looking market metrics indicate higher inflation in the future, suggesting limited room for aggressive rate cuts by the Fed. Additionally, some investment banks believe that even with a soft inflation report, the Fed will not change its hawkish rate guidance. If the inflation report is hotter than expected, bitcoin may move closer to the lower end of its trading range between $90,000 and $110,000.



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