Key facts
- Bitcoin, Ethereum, and XRP prices declined following the release of US inflation data.
- US Producer Price Index (PPI) increased by 5.4% year-on-year, exceeding forecasts.
- Bitcoin fell approximately 2.7% in the last 24 hours, trading at $77,300.
- XRP dropped about 3.9% to $1.37.
- Ethereum decreased around 2.1% to $2,450.
- Market expectations for a Federal Reserve rate hike at the September 15-16 meeting rose to 74%.
Bitcoin, Ethereum, and XRP experienced significant pullbacks on Thursday as a higher-than-expected US Producer Price Index (PPI) report fueled expectations of further interest rate hikes by the Federal Reserve. The PPI data showed a 5.4% annual increase, slightly above the consensus forecast of 5.3%, indicating persistent inflationary pressures.
In response to the inflation report, Bitcoin's price dropped around 2.7% in the past 24 hours to trade at $77,300. XRP fell approximately 3.9% to just over $1.37, while Ethereum tumbled about 2.1% to $2,450. Technical analysis of Bitcoin's 1-hour chart indicated increased bearish momentum, with sellers taking control after the inflation data release.
The market's focus has shifted to the Federal Reserve's upcoming policy meeting on September 15-16. Following the PPI release, CME FedWatch data showed traders pricing in a 74% probability of a rate hike to the 3.75%-4.00% range, up from 80% prior to the report. Higher interest rates typically negatively impact cryptocurrencies by strengthening the US dollar and increasing Treasury yields, thereby reducing demand for risk assets. The upcoming CPI report is also being closely watched for its potential to further influence the Fed's decision and crypto market sentiment.