Bitcoin and Gold Rebound Quickly After US Core Inflation Data Exceeds Monthly Estimates
A brief flash crash struck Bitcoin and gold after monthly core CPI surpassed forecasts, before both assets recovered within minutes.
Bitcoin and spot gold experienced immediate flash drops on Friday following the release of the August U.S. Consumer Price Index before recovering most of their losses within minutes. Bitcoin dropped from approximately $77,100 to $76,050 before rebounding, while gold slipped from $4,353 to $4,292 per ounce within the same minute before stabilizing near $4,358.
While annual headline CPI matched expectations at 3.4% and annual core inflation matched at 2.4%, the monthly core figure exceeded forecasts. Core CPI rose 0.29% month-over-month, rounding to 0.3% against economist expectations of 0.2% across seventeen published projections. Shelter costs increased 0.3% on the month, while energy rose 2.1%, led by a 3.9% monthly jump in gasoline.
The simultaneous drop in both assets was linked to pressure from rising bond yields. The 10-year U.S. Treasury yield hovered near 4.95% ahead of the report, as higher yields increase the opportunity cost of holding non-yielding assets such as gold and Bitcoin.
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