Bitcoin Falls as Hot Inflation Puts a Fed Hike Back on the Table
September CPI hit 3.7%, above forecasts, sending Treasury yields higher and dragging crypto down with stocks.
The Canadian Dollar experienced a decline on Wednesday as the US Dollar rallied to a record high, driven by stronger-than-expected US inflation data. The USD/CAD exchange rate reached around 1.4287, marking a 0.50% increase for the day, near 18-month highs. The September Consumer Price Index (CPI) came in at 0.6%, matching market expectations and up from August's 0.4% increase.
Annual headline inflation surged to 3.7% from 3.4%, surpassing the 3.6% forecast. Core CPI, excluding food and energy, rose 0.3% monthly, above the 0.2% expectation and unchanged from August's figure. Core annual inflation, too, increased to 2.6% from 2.4%, also exceeding the 2.5% forecast. The data suggests the Federal Reserve may consider raising interest rates at their next meeting on October 27-28, up from a previous 22% probability.
The Federal Reserve now faces a higher risk of incurring inflation, particularly due to oil prices impacted by Middle East tensions. Analysts anticipate traders will closely monitor the US Producer Price Index (PPI) and retail sales figures released on Thursday, alongside the potential further tightening of the Fed's monetary policy.
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- Canadian Dollar weakens as US CPI puts October Fed hike in play fxstreet.com
- US dollar hits 18-month high as hotter inflation revives Fed rate hike concerns thehindubusinessline.com
