On Tuesday we saw the release of August's CPI numbers from the BLS, which indicated that in comparison to last year, CPI inflation has risen by 8.3%.
The Fed Open Market Committee meets next week on Wednesday to determine the next increase to the Fed Funds Rate. The market is currently predicting that a 75bps hike is most likely.
The US average mortgage rate broke above 6% this week for the first time since the 2008 housing crisis.
With Treasury yields and the US Dollar Index spiking, the major equity indices appear to be breaking down towards their YTD lows,
Spot Bitcoin price also has seen extreme weakness following Tuesday's hotter than expected CPI number, and could be on a collision course with its June lows.
On-chain data shows new waves of Bitcoiners becoming long term hodlers every 4 years.
Mining Difficulty All-Time High
Despite the bearish price action and Bitcoin being well off its all-time high, mining difficulty just reached a new all-time high.
This increase can be attributed to three main factors.
Mining rigs that were capitulated this summer have been sold, relocated, and plugged in by more efficient miners likely with lower energy costs. Much of the hash rate that came off the network has likely turned back on now.
New generation rigs have now been released and shipped all over the world. This includes both S19XPs from Bitmain and M50s from MicroBT. These are the most energy-efficient rigs on the market and they pack a high hash rate (140 TH and 114 TH respectively).
Power curtailments are happening less due to extreme heat and stress on energy grids subsiding (Riot’s Whinstone facility in Texas).