Hawkish Sentiment Soars Ahead of Fed Meeting

The final inflation report before the Federal Reserve's highly anticipated meeting is out, and it's painting a complicated picture of the US economy. The jobs report from August showed that the US added 162,000 jobs, nearly triple expectations, indicating a strong labor market.

However, producer inflation surged to 5.4%, up from 4.8% in July, while consumer inflation remains well above the Fed's 2% target at 3.7%. Oil prices have also jumped past $100 per barrel, and diesel prices reached record levels in the country.

The combination of these factors suggests a hawkish stance by the Fed, which could spell trouble for risk-on assets like Bitcoin. The probability of a 25-basis-point rate hike has jumped to 79%, with futures pricing the odds at 87% after the inflation data release.