Bitcoin slides into the $82,000s after hotter-than-expected U.S. September CPI

Bitcoin fell nearly 2% within an hour into the $82,000s after U.S. consumer prices for September came in hotter than expected. The U.S. Bureau of Labor Statistics (BLS) said on Oct. 14 at 8:30 a.m. ET (9:30 p.m. KST) that the Consumer Price Index (CPI) rose 3.7% from a year earlier. Bitcoin, which had been trading in the $83,900 range on Binance, dropped to $82,364 within 45 minutes of the release.

Gasoline drove the 3.7% reading

According to the BLS, September CPI rose 0.6% from the previous month on a seasonally adjusted basis, after a 0.4% gain in August. The annual rate climbed to 3.7% from 3.4% in August. Market forecasts cited by CoinDesk were 0.6% month over month and 3.6% year over year.

Gasoline accounted for more than half of the increase. The BLS said the gasoline index jumped 9.1% in September, accounting for over half of the monthly all items increase. The energy index rose 5.2% over the month and 20.4% over the year, with gasoline alone up 34.2% from a year earlier. Shelter rose 0.4% in September, up from 0.3% in August. Owners' equivalent rent, an estimate of what homeowners would pay to rent their own homes, rose 0.3%, and rent rose 0.2%. Food was unchanged overall, as food away from home rose 0.2% and food at home fell 0.1%.

Core CPI, which excludes volatile food and energy, rose 0.3% from the previous month, matching August but above the 0.2% forecast. The annual core rate rose to 2.6% from 2.4% in August, against a forecast of 2.5%. The BLS said recreation, used cars and trucks, education, airline fares, medical care and apparel rose within core prices, while communication fell.

The first hour after the release, in 15-minute steps

Bitcoin had risen from the $83,400 range to the $83,800 range from 9 p.m. KST, half an hour before the release. The mood shifted with the inflation data. Here is how it moved on Binance's BTC/USDT 15-minute chart.

1. Oct. 14, 9:15 p.m.Trading in the $83,800 range ahead of the release
2. 9:30 p.m.CPI released. Bitcoin touched $83,933 at the moment of the release, then fell to $82,605 within 15 minutes, a drop of more than $1,000
3. 10:15 p.m.Hit a low of $82,364, 1.9% below the high at the release
4. 10:30 p.m.Trading in the $82,600 range

Altcoins fell further over the same period. On Binance, from 9:15 p.m. KST to their lows, ether dropped 2.4% from $2,517 to $2,457, solana fell 3.0% from $107.87 to $104.58, and XRP slid 2.3% from $1.380 to $1.349.

In futures markets, positions betting on higher prices were wiped out in large numbers. According to Coinyong's liquidation page, $136.3 million in futures positions were forcibly liquidated on Binance, Bybit and OKX in the hour from 9:30 p.m. KST, of which $130.1 million were longs (bets on rising prices). Liquidations of shorts (bets on falling prices) totaled just $6.2 million.

Gold and Nasdaq futures fell too

Crypto was not the only market shaken by the data. Gold futures fell 1.7% from $4,175 an ounce just before the release to $4,105 at 10:20 p.m. KST, while Nasdaq 100 futures dropped 0.9% from 30,839 to 30,550 over the same period. According to CoinDesk, the U.S. 10-year Treasury yield rose 9.3 basis points to 5.308%, and the 2-year yield rose 13.1 basis points to 4.924%.

CoinDesk reported that several Fed officials had signaled the possibility of another 25-basis-point hike before year-end ahead of the data, and that markets had expected a pause in October and a hike in December. The outlet wrote, "This morning's numbers just might put an October rate hike back on the table." The Fed's next policy meeting (FOMC) is on Oct. 27-28, followed by Dec. 8-9.

Upbit at 111.99 million won, kimchi premium at 0.8%

The Korean market moved in step. Bitcoin's Korean won price on Upbit fell from the 113.04 million won range at 9:30 p.m. KST to 111,495,000 won at 10:15 p.m., and traded at 111,997,000 won at 10:30 p.m. The kimchi premium (the gap between prices on Korean exchanges and global markets), comparing Upbit with Binance converted to won at the same time, was 0.79%.

The funding rate (the fee exchanged between long and short positions) on Binance's bitcoin perpetual futures stayed positive at 0.0033% as of 10:30 p.m. KST. The share of Binance accounts holding long positions was 58%, up 1 percentage point from the hour before the release.