EXPECTED RISE

As predicted, consumer prices rose 0.2% in July, with inflation increasing due to higher housing costs, according to the latest Labor Department report. The consumer price index (CPI) went up by 0.2% for the month, resulting in a 2.9% yearly inflation rate. Meanwhile, the core CPI, which excludes food and energy, also increased by 0.2%. Shelter costs played a significant role in the inflation rise, with food prices going up by 0.2% while energy remained unchanged. Although these results show that inflation rose, the increase was moderate, thus, they show that levels are gradually returning to the Federal Reserve’s target of 2%, which reinforces the speculation that interest rate cuts might occur in the upcoming meeting in September. 

MINERS OPTIMISM SOARED

Despite recent drops in Bitcoin prices and all-time low hash prices, miners are once again increasing their capacity, showing optimism in the industry. According to a report by CryptoQuant, Bitcoin miners are expanding their operations as the network’s hashrate reached a new all-time high this week. The hashrate, which is the computational power used by miners to generate new bitcoin and validate transactions on the network, peaked at 627 exahash per second yesterday, bouncing back from a decline in July. Moreover, the recent spike in miner outflows was triggered after bitcoin prices dipped to $49,000, and it is worth noting that such events typically occur near price bottoms during bull markets. Furthermore, despite the costs associated with running mining operations, as of 8:00 AM CST, Bitcoin is currently trading above $61,000, marking a 2.8% increase in the past 24 hours.

SIGNIFICANT INVESTMENT 

The renowned investment bank, Goldman Sachs, has recently revealed its positions in various bitcoin exchange-traded funds (ETFs) in the U.S. This disclosure was outlined in a quarterly 13-F report, underscoring the bank’s increasing involvement in the cryptocurrency market. Notably, Goldman Sachs holds significant investments in seven out of the 11 BTC ETFs, with its largest stake in the iShares Bitcoin Trust valued at $238.6 million. This move represents a notable departure from the bank’s previous stance on digital assets, with executives, such as Goldman Sachs’ global head of digital assets, now recognizing the potential of BTC ETFs to revolutionize the financial landscape. They have highlighted the success of bitcoin ETFs as a pivotal moment for the industry, and emphasized their transformative impact on financial systems. 

SIGNS OF RECOVERY

Homeowners across the country seem to be seizing the opportunity presented by a significant drop in mortgage rates as refinance applications saw a substantial surge of 35% compared to the previous week, which reflects a renewed interest in mortgage refinancing. Despite a slight decrease in the average contract interest rate for 30-year fixed-rate mortgages, the overall trend has been a notable decline in rates over the past four weeks. This shift has sparked increased activity in the housing market, particularly in terms of refinance applications, which reached their highest levels since May 2022. On the other hand, applications for new home purchases also experienced a modest increase of 3% for the week. Moreover, it is worth noting that the combination of lower interest rates and the ongoing challenges of high home prices and limited inventory have prompted some prospective buyers to adopt a cautious approach, nonetheless, many anticipate potential further decreases in mortgage rates. Ultimately, as the housing market continues to evolve, the balance between supply, demand, and interest rates remains a critical factor influencing both current homeowners and potential buyers.

INTERNATIONAL NEWS 

According to official figures released today, British consumer price inflation increased for the first time this year in July. The rise was smaller than expected, with services prices – closely monitored by the Bank of England (BOE) – increasing at a slower pace. The annual rate of consumer price inflation stood at 2.2%, slightly below the median 2.3% forecast. Following the release of this data, the pound fell sharply against the U.S. dollar, and financial markets now anticipate a 44% chance of a quarter-point rate cut by the BOE in September. Moreover, the central bank has stated that it anticipates a gradual increase in inflation, aiming to reach and stabilize around 2% by 2026. However, it is worth remarking that despite some improvements, many households continue to feel the impact of previous rising prices.