Bitcoin fell below $81,000 as Fed rate uncertainty unsettled markets after hotter-than-expected U.S. inflation data. Bets on an October interest-rate increase briefly approached 50% before retreating, while South Korea’s Kospi plunged 8% and triggered circuit breakers.
Key takeaways
- September U.S. inflation reached 3.7%, exceeding expectations.
- October rate-hike bets cooled to roughly 26%–30%.
- U.S. spot bitcoin ETFs lost $150.5 million on October 14.
- Ether, XRP and Solana fell while PYTH gained more than 7%.
According to CoinDesk, bitcoin approached $80,000 in early Asian trading, recovered briefly to about $81,500, then stalled near $81,000. At the report’s publication, it had lost more than 2% over 24 hours and was down 1% since midnight UTC.
Bitcoin falls as inflation accelerates
September’s Consumer Price Index rose 3.7% annually, up from 3.4% in August. The October 14 release exceeded the 3.6% forecast from economists surveyed by Dow Jones.
Core CPI, which leaves out food and energy, also accelerated. Its annual increase reached 2.6%, compared with 2.4% the previous month and a 2.5% forecast.
The crypto decline extended beyond bitcoin: Ether, XRP and Solana each lost between 3.5% and 4%. PYTH stood apart as the only cryptocurrency among the top 100 still showing a gain above 7%.
Vikram Subburaj, CEO of India-based exchange Giottus, said the stronger inflation reading had revived concerns about interest rates staying higher for longer and increased uncertainty over the Federal Reserve’s next decision.
Bitcoin faces Fed rate uncertainty despite cooling hike bets
Markets reduced their October rate-hike expectations after an initial surge, but probabilities remained above their pre-release levels on CME’s FedWatch tool.
On Polymarket, the chance of an October increase briefly neared 50% before easing to about 30%. CME FedWatch showed the probability rising from roughly 22% to almost 47%, then falling to 26%.
Holding rates steady remained the more heavily priced outcome. CME fed funds futures put that probability above 70%, consistent with STS Digital’s Anderson, who expected the Fed to leave rates unchanged in October.
ETF withdrawals accompany liquidity concerns
According to figures cited by Subburaj, U.S. spot bitcoin ETFs saw $150.5 million flow out on October 14, a reversal from the $175.7 million that had flowed in the day before.
Market-making firm STS Digital tied the Fed decision’s uncertainty to thinner liquidity and a diminished appetite for risk throughout the markets.
“With the next FOMC a coin flip, this uncertainty is damaging liquidity and dampening risk appetite across all asset classes,” Anderson said in an email quoted in the report.
Kospi plunge extends the global selloff
South Korea’s Kospi fell 8%, setting off circuit breakers as traditional markets also turned risk-averse.
Nasdaq futures were down 1% at the time of the report, following a 2% decline on October 14. The equity losses accompanied the pullback in bitcoin and other major cryptocurrencies.
Macro pressures extend beyond the inflation headline
Bitcoin’s exposure to Fed rate uncertainty was a focus of analyst commentary before the inflation release. The earlier report highlighted how policy expectations, Treasury yields and financing costs transmit inflation concerns into crypto markets.
Ryan Lee, chief analyst at Bitget Research, warned before the release that an upside inflation surprise risked another round of liquidations as yields and Fed expectations adjusted. He said an earlier selloff had reduced leverage without necessarily clearing the market’s riskier positions.
Utkarsh Ahuja, founder and managing partner of Moon Pursuit Capital, said higher inflation can sustain elevated Treasury yields, support the dollar and raise capital costs. A Bitunix analyst likewise warned that a hotter report risked pushing yields and the dollar higher, pressuring digital assets.
Anderson identified energy shocks, fixed-income volatility and AI valuations as additional pressures on sentiment, describing digital tokens as increasingly sensitive to macroeconomic factors.
Article produced with the assistance of artificial intelligence and reviewed by the editorial team.
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