Bitcoin has erased recent gains, plunging below the $22,000 level once again
The price of Bitcoin, the world’s largest cryptocurrency, has plunged sharply on a worse-than-expected inflation report, losing 4.7% of its value in mere minutes.
The core consumer price index (CPI) rose 0.6% on a month-over-month basis, which is roughly double the forecast.
The latest inflation data has thrown a wrench in the works for those who expected Bitcoin to finally start recovering in September after bulls managed to defend the $20,000 level.
The cryptocurrency’s price action is still driven by broader macroeconomic factors, which is why it plunged swiftly together with U.S. stock futures.
The new CPI data will likely prompt policymakers at the U.S. Federal Reserve to adopt an even more aggressive monetary policy.
The market is now pricing in a 19% chance of a mammoth 100-basis point hike in September, but the consensus appears to be that the Fed will settle for another 75-basis point increase.