Cryptocurrencies prices fell on Thursday morning as the total crypto market cap tanked by more than 4% to around $919 billion.
In the specific digital asset markets, Bitcoin (BTC/USD) dropped by more than 4% to trade at lows of $18,300. As Invezz highlighted earlier today, Bitcoin price had retreated below $19,000 amid negative sentiment ahead of the US Consumer Price Index (CPI) data release.
Meanwhile, Ethereum (ETH/USD) led a broader decline across the altcoin space with nearly 7% in sharp losses, the sell-off triggered by risk assets market reaction to the latest US inflation data released at 08:30 am ET today.
Wall Street also opened sharply lower after consumer prices rose year over year and month on month, the hot data showing inflation was at 40-year highs during September. The last time inflation rose to these levels was in 1982.
The S&P 500 fell by more than 2%, while Nasdaq slumped nearly 3% and the Dow Jones Industrial dropped over 500 points in early trades. The losses saw premarket gains go up in smoke as the 0.4% CPI jump in September beat the expected 0.2% gain. Core CPI rose 0.6% from the previous print, with the hotter-than-expected inflation readings up 8.2% YoY and 6.6% YoY for overall CPI and core CPI respectively.
The inflation readings suggest the Federal Reserve will press on with the aggressive rate hikes approach – the next raise now expected to be by another 75 basis points.
Economist Peter Schiff says the Fed is “losing the fight against inflation” and that it will “soon surrender.”
The outlook is also shared by Steve Liesman, a senior economics reporter at CNBC, who believes the Fed is unlikely to pivot in the face of the latest inflation readings.
He told CNBC’s ‘Squawk Box’ that “you can’t even say inflation has peaked yet.”
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