Investors that expected a sharper increase in inflation sold their assets.
Following the release of dismal inflation numbers on Tuesday, hazardous asset markets saw a precipitous decline.
The consumer price index (CPI) for August showed a price rise of 8.3%, which was higher than the projected 8.1 percent.
Core inflation of 6.3% was substantially higher than expected (6.1% increase) since it does not include food and energy costs.
Shortly after the news emerged, the price of bitcoin (BTC) fell, falling by approximately 5% within the hour of 12:00 UTC when the inflation data was disclosed.
Bitcoin (BTC) has risen 9% in the previous week. The volume of transactions was seven times its 20-day average. Bitcoin’s market cap has fallen below $21,000.
The price of ether (ETH) fell 6.27 percent in the hour beginning at 12:00 UTC and 7.5% in the hour just finished.
Additionally, volume was above average for the cryptocurrency that holds the second-place spot in terms of market value.
ETH’s price dip corresponds with the impending Merge upgrade, which will move the cryptocurrency from proof-of-work to proof-of-stake. 15 September is the deadline.
Today’s inflation numbers are due. The FOMC may hike rates more forcefully at its next meeting due to higher-than-expected inflation.