Core consumer prices – which would have stripped out what everyone already knew were rising energy costs – rose 0.4% in April, double March’s 0.2% pace and higher than the 0.3% economists had expected.
On an annual basis, core CPI rose 2.8% against 2.6% in March and 2.7% forecast.
Headline CPI – which includes energy costs – was higher at 3.8% in April compared to just 3.3% in March and 3.7% expected. This 3.8% was the fastest pace of inflation since May 2023.
The data has market participants quickly pricing in rate hikes from the Federal Reserve – a massive change from weeks ago, when the question was how often the Fed would cut rates in 2026.
According to CME FedWatch, markets see more than a 35% chance of one or more rate hikes this year.
The news helped send shares lower, led by the Nasdaq’s 1.3% drop.
However, Bitcoin (BTC) has held steady and is currently trading at $80,500, largely unchanged over the past 24 hours. Major altcoins such as ether (ETH) and XRP (XRP) have fallen closer to 2.5%.
