Bitcoin fell about $1,000 to $82,800 after September inflation data came in above forecasts. Year-over-year CPI rose 3.7% and core CPI 2.6%, which may put further Federal Reserve rate hikes back into play.
Bitcoin dropped $1,000 to $82,800 on Wednesday after U.S. inflation for September came in hotter than economists expected. The data perhaps puts multiple Fed rate hikes back in play.
CryptoPotato reported the asset stood at around $83,800 before sliding to $82,800 in the first minutes after the release.
Inflation overshoots on the annual and core readings
The September Consumer Price Index rose 0.6%, up from 0.4% in August, according to the Bureau of Labor Statistics. That matched economist forecasts for 0.6%.
The annual figure, however, rose 3.7% versus 3.4% in August, above estimates for 3.6%. Core CPI, which strips out food and energy costs, rose 0.3% in September, the same pace as August but above consensus forecasts for 0.2%.
Year-over-year core CPI reached 2.6% versus 2.4% the previous month, against estimates for 2.5%.
Bonds, equities and gold react
The 10-year yield jumped 9.3 basis points to 5.308%, and the 2-year yield rose 13.1 basis points to 4.924%.
Nasdaq 100 futures fell 0.65% and S&P 500 futures 0.3%, while gold slumped 1.5% to $4,116 per ounce.
Fed expectations and bitcoin support levels
Before the data, several Fed speakers had hinted that the central bank was likely to raise rates another 25 basis points before year-end. Market pricing reflected most expecting a pause at the meeting later this month and a rate hike in early December. This morning's numbers just might put an October hike back on the table.
Lacie Zhang, research analyst at Bitget Wallet, told CryptoPotato that a similar reading could "trigger a sharper repricing". She put the next major support line for bitcoin at $81,000-$82,000, which it could retest if selling pressure intensifies.
Sources: CoinDesk, CryptoPotato
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