On Thursday, cryptocurrency prices fell across the board as market participants waited for inflation data from the United States. Ethereum was trading at £1083.52 today, a decrease of just over 1.5%, while bitcoin was trading at £16335.15, a decrease of 0.87% over the last 24 hours.
Altcoins saw more-significant losses. According to the data provided by TradingView, ADA dropped by 5.14% during the last 24 hours, SOL dropped by 5.3%, and Ripple’s XRP dropped by 6.75% during the same time frame.
On Thursday, equity futures increased ahead of the announcement of the U.S. inflation data, which was scheduled for release at 8:30 am Eastern Time (ET). S&P 500 futures increased by 0.51%. In the meantime, futures for the Nasdaq 100 rose by 0.29%.
According to a survey conducted by Bloomberg, year-on-year inflation will come in at 8.1% for September, while month-on-month inflation will register at 0.2%. It is anticipated that core estimates, which do not include the cost of food goods or gasoline, will increase by 6.5% year-on-year and a rise of 0.4% month-on-month.
According to the Global Head of Market Research at Forex.com, Matt Weller, anything above this could potentially put a nail in the proverbial coffin and seal a 75 basis point interest rate hike from the Fed at the beginning of next month. This prediction was based on the assumption that anything above this would put a nail in the proverbial coffin.
As a result of the fact that “both the cryptocurrency market and traditional risk assets remain highly correlated with monetary policy expectations,” and “any prospect of a Fed pivot still at least a couple months out,” Weller concluded that “the risks for bitcoin, ether and the rest of the crypto space are to the downside ahead of the US CPI print.”
Aside from that, Goldman Sachs is sticking to its prediction that the Federal Reserve will raise interest rates by 75 basis points in November, 50 basis points in December, and 25 basis points in February, to reach a terminal forecast of 4.5% to 4.75%. This prediction was made back in September.
Finally, during the past two weeks, there have been indications that the link between BTC and equity markets is weakening. On the other hand, the drop reached a peak in advance of today’s critical data release.