BTC Slides Under $82K Mark as Surging Energy Costs Drive Up US Consumer Inflation
The leading cryptocurrency descended beneath $82,000 as bond yields approached fresh 24-year peaks following elevated US CPI inflation readings.
The price of Bitcoin (BTC) descended beneath the $82,000 threshold following Wednesday's opening bell on Wall Street as consumer inflation figures in the United States exceeded market forecasts.
Key points:
- The cryptocurrency declined to $81,926 on the Bitstamp exchange following the release of September's US CPI inflation data showing 3.7% compared to the anticipated 3.6%.
- Rising fuel costs represented the majority of the overall increase, registering 9.1% on a year-over-year basis.
- Bond yields in the United States jumped following the announcement, while the precious metal gold declined to $4,079 per ounce.
Bitcoin descends below $82,000 following elevated US CPI figures
Information from TradingView demonstrated that cryptocurrency, gold and stock-market futures experienced downward movement subsequent to the publication of the Consumer Price Index (CPI) figures for September.
The year-over-year reading of 3.7% represented a figure 0.1% higher than the prevailing market consensus, as information from the Bureau of Labor Statistics (BLS) verified. The escalation in fuel costs amid the Middle East conflict and the crisis affecting oil supplies was particularly notable.
"The index for gasoline rose 9.1 percent in September, accounting for over half of the monthly all items increase. The energy index increased 5.2 percent over the month following a 2.1-percent increase in August," an official release stated.
Nevertheless, inflationary pressures rose across multiple categories, as the core CPI measurement — which excludes energy and food components — similarly registered 0.1% above expectations with a year-over-year rate of 2.6%.
Providing commentary, Sonu Varghese, chief macro strategist at Carson Group, indicated that heightened inflation readings ought to have been anticipated.
"The only surprise is that investors keep getting surprised by broad-based inflation. And we've yet to see the full impact of higher diesel prices and the AI boom,"
he told CNBC.
Fresh data from CME Group's FedWatch Tool demonstrated markets recalibrating their expectations regarding Federal Reserve monetary policy in response to the inflation figures. The majority of participants now anticipated a 25-basis-point interest-rate hike at the Fed's forthcoming meeting on Oct. 28, with probability for that scenario reaching 53.7% compared to 22.1% recorded the previous day. Looking ahead to December, the likelihood of an additional 25-basis-point rate increase stood at 50%.
"Taken in combination with the soft payroll numbers in the September employment report, the FOMC is probably on hold for any rate moves at the upcoming October 27-28 meeting although with a definite bias toward a hike in December," said Theresa Sheehan, economic analyst at Econoday.
As previously reported by Cointelegraph, the subsequent critical US inflation data release, representing the September Producer Price Index (PPI) print, is scheduled for Friday.
Analysis: Elevated CPI figures represent "last thing global bond markets needed"
The price of gold experienced a decline reaching as low as $4,079 per ounce in the wake of the CPI announcement, while bond yields in the United States experienced sharp increases.
The yield on 10-year Treasury bonds, which demonstrates high sensitivity to energy-price catalysts, reached 5.329%, positioning itself approximately three basis points below fresh 24-year peak levels.
"This is the last thing global bond markets needed. Prior to this number, it looked like the global bond sell-off was calming, but now bond markets are catching on fire again,"
economist Robin Brooks wrote in a blog post.
Price action for BTC maintained its movement around a critical zone ranging between $82,500 and $83,400, with market analysts continuing to monitor whether the market would establish this level as support.