The crypto market faced a fresh jolt on October 14 after the U.S. Bureau of Labor Statistics released September's Consumer Price Index, with annual inflation rising 3.7%, slightly above economists' expectations of 3.6%. The month-over-month CPI increase matched forecasts at 0.6%.
Core CPI, which strips out volatile food and energy prices, climbed 2.6% year-over-year and 0.3% month-over-month, compared with estimates of 2.5% and 0.2%, respectively. The hotter-than-anticipated inflation reading adds to earlier PPI and U.S. jobs data that traders have been watching closely for clues on the Federal Reserve's next monetary policy move.
Bitcoin reacted swiftly, falling from around $83,800 to $82,800 in the initial minutes after the CPI release — a drop of roughly $1,000. The move underscored how sensitive digital assets remain to macroeconomic indicators, especially inflation figures that could influence interest rate expectations.
Before the release, market participants had braced for a rise in annual CPI from 3.4% to 3.6%, with influencer Ran Neuner warning traders to prepare for potential volatility. The actual 3.7% print reinforced concerns that the Federal Reserve may need to keep policy tighter for longer, weighing on risk assets including equities and cryptocurrencies.
