US Inflation Quickens to 3.7%, Pushing Bitcoin Below $83,000

US consumer prices rose 3.7% in the 12 months through September, up from 3.4% in August and above the 3.6% economists expected, the Bureau of Labor Statistics said at 8:30 AM ET on Oct. 14. Bitcoin dropped on the print: within the first minute, BTC on Binance slid from $83,900 to $82,731, a fall of roughly 1.4%.

Details

Headline inflation. The CPI rose 0.6% on the month after a 0.4% gain in August, matching forecasts. Gasoline did most of the work, jumping 9.1% and accounting for more than half of the monthly increase. Energy overall climbed 5.2% in September and is up 20.4% from a year earlier. Food prices were flat, while shelter rose 0.4%.

Core inflation. Prices excluding food and energy rose 0.3% for a second straight month, lifting the annual core rate to 2.6% from 2.4%. According to CoinDesk, economists had expected 0.2% and 2.5%, so the stickier measure the Fed watches most closely also came in hot.

Market reaction. Bitcoin had held above $83,000 through the morning and briefly touched $84,000 ahead of the data. One-minute Binance candles show the price falling from $83,933 to $82,731 at 8:30 AM ET; as of 8:34 AM ET, BTC traded near $82,860. Live price on the market dashboard.

What it means for the market

This was the last inflation report before the Fed's Oct. 27⁠–⁠28 meeting. The central bank raised rates to 3.75%–4.00% in September, and most officials saw one more hike as likely before year-end. Going into the report, markets largely priced a pause in October and a hike in December, CoinDesk noted. Faster headline and core inflation raise the odds of a more aggressive Fed, and CoinDesk says multiple hikes could be back in play.

For bitcoin, higher rates mean tighter money and less appetite for risk assets. BTC has been stuck all month between its 50-day moving average near $81,000 and $84,000, and the inflation data has pushed it back toward the lower half of that range.