Solana and Chainlink Lead Altcoin Rally After Softer U.S. Inflation Data Fuels Fed Rate Cut Bets

The cryptocurrency market surged on Tuesday after the latest U.S. inflation data came in cooler than expected, fueling speculation of a September interest rate cut by the Federal Reserve. #Solana (SOL) and #Chainlink (LINK) were among the day’s biggest winners, supported by a combination of macroeconomic optimism and accelerating institutional investment.

According to CoinGecko data, Solana jumped 12.9% to trade at $198.48, while Chainlink rallied 12.5% to $24.21 over the past 24 hours. Other leading altcoins also posted notable gains, with Ethereum climbing 8.6% to $4,670.42, Cardano up 8.9% to $0.85, Dogecoin adding 6.2% to $0.23, Sui advancing 5.9% to $3.91, and XRP gaining 3.0% to $3.25.

Inflation Data Sparks Market Optimism

The rally followed the release of July’s Consumer Price Index (CPI), which showed headline annual inflation at 2.7%, slightly below economists’ consensus forecast of 2.8%. The softer inflation print gave traders more confidence that the Federal Reserve could move ahead with rate cuts in the coming months.

Markets are now pricing in an 82.5% probability of a September rate cut, according to the CME FedWatch Tool—a slight decline from 86% odds recorded on Monday, but still an overwhelmingly dovish market expectation.

Min Jung, senior analyst at quantitative trading firm Presto, told Decrypt that while macroeconomic factors are supportive, the key driver in this cycle is institutional participation.

“The current market dynamics are fundamentally different from previous crypto cycles, being driven predominantly by institutional adoption, led by aggressive buying from digital asset treasury companies,” Jung explained.

He added that Tuesday’s rally was “clearly accelerated by the CPI release, which reignited optimism for a September rate cut—a sentiment echoed in the latest FedWatch projections.”

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