Bitcoin Slips Below $77K as Fed Hike Odds Surge

Bitcoin slipped below the psychologically important $77,000 level on Thursday as investors sharply increased their expectations of another Federal Reserve interest-rate hike.

The world's largest cryptocurrency fell to an intraday low of roughly $76,748 on Sept. 10.

Fed hike odds surge after hot inflation data

Expectations of tighter monetary policy jumped on Thursday after the latest U.S. Producer Price Index showed wholesale inflation remaining hotter than economists had hoped.

The PPI rose 5.4% year over year in August, slightly above the 5.3% consensus estimate. The monthly increase came in at 0.4%.

Following the release, traders increased bets that the Federal Reserve would raise interest rates by at least 25 basis points at its Sept. 16 meeting.

The CME FedWatch tool showed the probability of a hike climbing to roughly 70% following the PPI report, compared with around 64% beforehand. Other market gauges put the odds even higher, at approximately 74%.

All eyes are now on Friday's Consumer Price Index report. Markets are expecting headline inflation to rise around 0.4% in August.

A hotter-than-expected CPI print could further cement expectations of a September hike.

Surging oil prices reignite inflation fears