Cryptos Muted Ahead Of Inflation Update

Cryptocurrencies hovered near the flatline early on Wednesday amidst anxiety ahead of the inflation update from the U.S. Consumer price inflation, the prime focus of the Fed’s monetary policy has been rising in the recent months triggering anxiety among investors across markets and particularly in risky assets like cryptocurrencies.

Annual headline consumer price inflation in the U.S. is seen rising to 3.6 percent in August, from 3.2 percent in July and 3 percent in June. Higher oil prices and base effects likely contributed to the uptick. Core inflation excluding the volatile food and fuel prices, is on a year-on-year basis seen dropping to 4.3 percent in August, from 4.7 percent in July and 4.8 percent in June.

Going by the CME FedWatch tool, the likelihood of the Fed raising rates by a quarter percent in the review next week is low at 7 percent. 93 percent of the interest rate traders expect the Fed to skip a rate hike in September. However, the probabilities expected for a quarter percent rate hike is higher in the subsequent periods. The probabilities of changes to the Fed rate and U.S. monetary policy, as implied by 30-Day Fed Funds futures pricing data is 39.9 percent in November, 41 percent in December and 37.3 percent in January.

An interest rate decision by the ECB is due on September 14 and by the Federal Reserve on September 20. Weaker-than-expected GDP data from U.K. also swayed sentiment.

The Dollar Index, a measure of the Dollar’s relative strength is currently at 104.77, having increased 0.06 percent from the previous close of 104.71. Wall Street Futures are trading with mild losses. Gold Futures are trading close to the flatline. Brent Crude Oil Futures traded close to 10-month highs, triggering fears of another wave of fuel-fed inflationary spiral.

Overall crypto market capitalization is steady at $1.04 trillion.

Bitcoin traded between $26,451 and $25,781 in the past 24 hours. It is currently changing hands at $26,181.66, having gained 0.4 percent on an overnight basis. BTC has gained 1.7 percent in the past week. Bitcoin’s crypto market dominance edged up to 49.1 percent, from 49 percent a day earlier.

Ethereum traded between $1,616 and $1,582 in the past 24 hours. The current price of $1,601.34 is half a percent lower on an overnight basis. Ether has shed close to 2 percent in the past week. Ethereum’s crypto market dominance slipped to 18.5 percent, from 18.7 percent a day earlier.

4th ranked BNB (BNB) shed half a percent in the past 24 hours. BNB has declined 1.5 percent in the past week. Meanwhile Binance.US, has reportedly cut its staff size by a third, triggering resignation of CEO Brian Shroder.

6th ranked XRP (XRP) added 0.70 percent overnight but has shed 3.9 percent in the past week.

7th ranked Cardano (ADA) is trading 0.6 percent lower amidst losses of 3.4 percent accumulated over the past week.

8th ranked Dogecoin (DOGE) dropped 0.71 percent overnight. Weekly losses exceed 4 percent.

9th ranked Solana (SOL) has slipped 1.4 percent overnight and 8.5 percent in the past week.

10th ranked TRON (TRX) gained 1.7 percent overnight, lifting weekly gains to 3.2 percent.

11th ranked Toncoin (TON) is the biggest gainer among the top 100 cryptocurrencies with a rally of 11.4 percent. 88th ranked Compound (COMP) followed with gains of 11.1 percent in the past 24 hours.

96th ranked Astar (ASTR) is the greatest laggard, shedding more than 8 percent in the past 24 hours. 20th ranked Stellar (XLM) also declined more than 7 percent.

Meanwhile, sentiment was boosted amidst reports that asset-manager Franklin Templeton also filed for a Spot Bitcoin ETF on Tuesday. Many traditional finance players including Blackrock have recently evinced interest in the ETF route as it would allow investors to gain exposure to bitcoin price movements without holding the cryptocurrency.

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