Bitcoin Sinks Under $82,000 After Fuel Costs Push US Inflation Higher

Bitcoin dropped to $81,926 after Wednesday’s Wall Street open, when US consumer prices for September rose 3.7% from a year earlier, 0.1 point above the 3.6% consensus.

Fuel Prices Drive the Inflation Jump

Energy was the main driver. The Bureau of Labor Statistics said the gasoline index rose 9.1% in September and made up over half of the monthly increase in all items, while the energy index gained 5.2% after a 2.1% rise in August. The jump is tied to the Middle East conflict and the oil supply crisis.

Fed Rate Hike Odds After the Data

CME Group’s FedWatch Tool shows markets now favor a 25 basis point hike at the Fed’s Oct. 28 meeting, with odds at 53.7% against 22.1% a day earlier. For December, the odds of a second 25 basis point hike stand at 50%.

Analysts expects the Fed to hold at the October 27-28 meeting, given soft payroll numbers in the September jobs report, though with a clear bias toward a hike in December. The next key inflation release, the September Producer Price Index, is due Friday.