US CPI Data Sparks Interest-Rate Hike Fears and Bitcoin Volatility
BTC/USD surged more than 3% on Friday after the US Consumer Price Index (CPI) data met expectations. The key inflation metric rose to a 22-year high in bond yields, with the 30-year yield hitting its highest levels since June 2004 before falling.
US core CPI inflation data increased by 0.3% month-on-month, surpassing expected gains of 0.2%. This led to an implied probability of an interest-rate hike by the Federal Reserve at the September 16 meeting rising to 85%, as shown in CME Group's FedWatch Tool.
Despite this, QCP Capital warned that high bond yields will cause Bitcoin pain amid tightening monetary policy. The company stated that Bitcoin bulls have little to look forward to, despite the recent surge of 25% in August after the US Treasury announced debt buyback interventions.