Key facts
- Crypto market liquidations exceeded $900 million in the last 24 hours.
- Bitcoin traded below $82,000.
- Inflation is spreading beyond energy prices into goods and services.
The crypto market is experiencing significant selling pressure and liquidations exceeding $900 million in the past 24 hours, driven by hotter-than-expected US inflation data. This has led UBS to revise its forecast, now anticipating two additional Federal Reserve rate hikes by March 2027, up from a previous expectation of one hike in December 2026. The persistent inflation, spreading beyond energy to goods and services, complicates the Fed's efforts to reach its 2% target and suggests prolonged restrictive monetary conditions. Market pricing currently suggests investors anticipate nearly five rate hikes, exceeding UBS's forecast, indicating growing uncertainty over the Fed's future actions. Higher borrowing costs associated with these hikes could reduce liquidity and weaken demand for riskier assets like cryptocurrencies.