Inflation in the United States was higher than projected in August, news that has impacted the cryptocurrency market, causing an overall drop of 5,2% on Tuesday.
The price of Bitcoin has corrected by 5,28% in the last 24 hours, following the release of data from the Consumer Price Index (CPI) report published by the United States Bureau of Labor Statistics.
In the report, the agency revealed that the year-on-year inflation in the United States fell in August for the second consecutive month, standing at 8,3%. However, the results were not as favorable as expected and inflation in the country remains excessively high. Also, the core CPI, which excludes food and energy, accelerated in August, rising more than twice as much as expected despite the Federal Reserve's tough monetary policy of raising interest rates. All this has dampened optimism and shaken markets, including the cryptocurrency market.
According to data from CoinMarketCap, The overall market cap of cryptocurrencies has fallen by 5,2% in the last 24 hours, standing at around $1,02 trillion at the time of writing.
Source: CoinMarketCap
Major cryptocurrencies on the market have been shaken by the US inflation report. Bitcoin is trading very close to $20.900 per unit, after having maintained its price on the rise since last Wednesday.
The price of Ethereum, the second largest cryptocurrency on the market, is trading below $1.600 per ETH. Even though The Merge is getting closer to becoming a reality on Ethereum, Ether shows a drop of 8,1% in its value in the last 24 hours.
Source: CoinMarketCap
Other large-cap cryptocurrencies in the Top 10, such as Polkadot, Cardano and Solana fell between 4% and 8% this Tuesday, after the results of the US CPI report were published. Local media also reported significant losses in other markets, such as the stock market.
Forecasters had been calling for a Consumer Price Index of 8,1% for August, while the Federal Reserve is aiming for a still-far-off inflation target of 2%.
The Federal Reserve is expected to continue tightening monetary policy, as it has been doing in recent months by raising interest rates, at its next meeting next week.
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