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U.S. Inflation Climbs to 30-Year High, Bitcoin Nears $70,000 & Oil Prices Drop as Stockpiles Increase

U.S. indices lower, as inflation climbs to 30-year high

Indices in the United States were lower on Wednesday, as data showed that the nation’s inflation rate had risen by its highest level in three decades. 

The figures from the Labor Department reported that its Consumer Price Index rose 6.2% from last year, which is the most since December 1990.

This was higher than the 5.9% many in the markets had expected and triggered comments from current U.S. President Biden.

đź’ˇ The Fed is under pressure
US core inflation – which strips out volatile items such as energy and food also jumped by more than Wall Street had anticipated, rising from 4% in September to 4.6% in October, its highest since 1991.

Pressure on America’s central bank to raise interest rates has now intensified

Biden stated that “Inflation hurts Americans’ pocketbooks, and reversing this trend is a top priority for me”.

One of the main drivers of this rise has been energy prices, which the president has publicly condemned in recent weeks.

As of writing, all major U.S. indices were trading in the red.

Bitcoin approaches $70,000

Moving on to crypto, prices of Bitcoin recorded new highs on Wednesday, as investors continue to pile into the recent bull run.

BTCUSD climbed to an intraday high of $68,925, after starting the week trading at $62,000, with many now expecting prices to rally above $70,000.

Many attribute this week’s rally to come as a direct result of U.S. inflation rates continuing to climb, with investors moving to crypto as a hedge.

đź’ˇNew record for bitcoin, what can we expect after fresh highs?
Some experts are saying we can only expect more and more records to be broken, claiming once and for all that bitcoin is here to stay.

Ethereum also rallied in today’s session, with the world’s second-largest cryptocurrency hitting a new high of $4,865.

As prices rise, long-term bears continue to anticipate a correction, with many technical indicators showing that markets are overbought.

Oil prices drop, as stockpiles increase

Oil prices fell considerably during Wednesday’s session, as figures showed that crude stockpiles were up in the last week.

Figures from the Energy Information Administration reported that crude inventories increased by 1 million barrels last week, compared with expectations of 2.1 million barrels.

Prices of WTI crude fell to an intraday low of $81.50, after opening the session trading at $84.61.

Never miss a winner, tune in to Coach’s market analysis

Many believe that the drop in WTI also comes as a result of comments from President Biden, who today spoke about working to lower energy prices.

Brent also fell, hitting a low of $83.14.

“Never invest in any idea you can’t illustrate with a crayon.”

– Peter Lynch

Eliman Dambell

Senior Market Analyst

 

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