Bitcoin Drops Under $82K as US CPI Tops Forecasts at 3.7% — SkimNews
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- Bitcoin fell to $81,926 on Bitstamp after September US CPI inflation printed at 3.7% YoY, beating the 3.6% consensus, with crypto, gold, and US stock futures all dropping simultaneously on the release
- The Bureau of Labor Statistics reported gasoline prices rose 9.1% YoY, accounting for over half of the monthly all-items increase, while the overall energy index climbed 5.2% month-over-month after a 2.1% gain in August
- Core CPI, which strips out food and energy, also came in 0.1% above expectations at 2.6% YoY, with Carson Group's Sonu Varghese noting investors 'keep getting surprised by broad-based inflation'
- CME FedWatch odds of a 25-basis-point rate hike at the Fed's October 28 meeting jumped from 22.1% to 53.7%, while December odds of a second 25bp hike stood at 50% after the print
- The US 10-year Treasury yield spiked to 5.329%, roughly three basis points off 24-year highs, prompting economist Robin Brooks to call the CPI result 'the last thing global bond markets needed'
- Gold fell as low as $4,079 per ounce as the simultaneous selloff across bonds, equities, and crypto signaled broad risk-off positioning tied to the inflation surprise
Why it matters: CME FedWatch odds of a 25bp October Fed rate hike more than doubled from 22.1% to 53.7% in a single print, while 10-year Treasury yields touched 5.329% near 24-year highs. With core CPI also beating at 2.6%, the stickiness isn't purely an energy story, tightening financial conditions across risk assets just days before the Fed's October 28 decision.
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