Bitcoin traded back above US$19,000 in Friday morning trading in Asia, rebounding with U.S. equities from a sharp drop that followed a September inflation reading in the U.S. Consumer Price Index (CPI) report on Thursday that was higher than expected. BNB and memecoin Shiba Inu were two other tokens among the top 10 by market capitalization to move higher. Solana and XRP fell.
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- Bitcoin fell as low as US$18,319 following the CPI release, but rebounded 5.6% over the past 24 hours to trade at US$19,352 at 8:30 a.m. in Hong Kong. Ether fell as low as US$1,209 before rising to US$1,287, though it was still off 0.7%, according to CoinMarketCap.
- All top 10 cryptocurrencies, excluding stablecoins, followed a similar sell-off and rebound trajectory, though prices were mixed over the past 24 hours. Shiba Inu rose 2.8% to change hands at US$0.00001046, overtaking Tron into the top 10 tokens by market cap. BNB gained 0.4% to US$272.06, which follows the successful hard fork of the BNB Smart Chain, the network it runs on, following a hack.
- Solana led the losers with a fall of 2.1% to US$30.52, while XRP dropped 1.5% to US$0.48.
- U.S. equities ended Thursday sharply higher after an initial sell-off following the release of the CPI. The Dow Jones Industrial Average jumped 2.8%, while the S&P 500 Index gained 2.6% and the Nasdaq Composite Index finished the day 2.3% higher. The S&P 500 and the Nasdaq broke six-day losing streaks.
- CPI data from the Bureau of Labor Statistics showed prices in the U.S. in September were 8.2% higher from the same month a year ago, which beat the 8.1% expected in surveys of economists. While the inflation indicator is down from August’s 8.3% and the peak of 9% in June, it remains near four-decade highs even after a series of interest rate hikes by the U.S. Federal Reserve to slow the pace of inflation.
- The CPI reading suggests another 75 basis-point rise in interest rates is all but guaranteed at the Fed’s next meeting in early November, with economists at Barclays Plc predicting rates could exceed 5% in 2023. U.S. interest rates are currently in a range of 3% to 3.25%. The Fed has said it is committed to bringing inflation back down to a target range of 2%.
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