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ADA, SHIB, AVAX Unexpectedly Decline by 6% as Market Selling Pressure Returns

Tue, 09/13/2022 - 14:05
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Tomiwabold Olajide
Traders anticipate another high-interest rate hike from Federal Reserve
ADA, SHIB, AVAX Unexpectedly Decline by 6% as Market Selling Pressure Returns
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Cryptocurrencies saw another sell-off as global markets pulled back following a jump in U.S. consumer prices last month, crushing hopes of a nascent slowdown and likely assuring another historically high-interest rate hike from the Federal Reserve.

Bitcoin, the largest cryptocurrency by market capitalization, fell 4% to reach lows near $21,000. As crypto traders hedge against the disappointment of the Merge, Ethereum Has seen a bigger decline, tumbling 6.90%.

Three Reasons Why Bitcoin Is Not Rallying Despite Potential Bottom Reached: Details

Avalanche, Cardano and Shiba Inu also recorded losses of the same magnitude, tumbling 8.42%, 6.42% and 8.56%, respectively.

Higher than expected U.S. inflation data drags down market

In August, U.S. inflation was stronger than anticipated, presumably keeping the Federal Reserve on track to raise interest rates by 75 basis points for the third time in a row.

According to Labor Department data released Tuesday, the consumer price index gained 0.1% in July after remaining unchanged in June. Prices increased 8.3% from a year ago, a little slowdown. The so-called core CPI, which excludes the more erratic food and energy components, increased by 6.3% from a year earlier and 0.6% from July. All measures exceeded expectations, and with historically high and pervasive price pressures still present, the Fed's inflation objective is still a ways off.

Billionaire Carlyle Co-Founder David Rubenstein Discloses Crypto Investment

Chair Jerome Powell said last week that the central bank would act "forthrightly" to achieve price stability, and some policymakers voiced support for another historically large rate hike. Officials have said their decision next week will be based on the "totality" of the economic data they have on hand, which also illustrates a strong labor market and weakening consumer spending.

Following the data, Treasury yields surged, while S&P 500 index futures slid and the dollar rose. Traders boosted bets that the Fed will raise interest rates by three-quarters of a percentage point, now seeing such an outcome as locked in.

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About the author

Tomiwabold is a cryptocurrency analyst and an experienced technical analyst. He pays close attention to cryptocurrency research, conducting comprehensive price analysis and exchanging predictions of estimated market trends. Tomiwabold earned his degree at the University of Lagos.