Tech stocks and crypto get thrown out of portfolios first Higher-risk tech stocks are usually valued on the basis of future earnings – higher interest rates eat into those earning projections. The correlation between tech stocks and crypto is kept in place by the fact that it is tech investors – usually of a younger demographic - that are most likely to also hold crypto. When investors are looking to rebalance their portfolios by jettisoning riskier assets, tech stocks and crypto will be at the top of the list. Returning to the latest inflation data, while the annual rate is slightly lower from July, at 8.3% now compared to 8.5 previously, that has done nothing to dampen the expectation that the U.S. Federal Reserve will continue with its aggressive interest rate hikes to curb inflationary pressures across the economy. Core inflation came in ahead of expectations The fall in crude oil prices in recent weeks accounts for the slight fall in soaring inflation compared to July. However, core inflation, which excludes food and fuel cost was substantially above forecasts at 6.3%, when a reading of 6.1% was thought likely. The July figure was 5.9%. The Fed makes its rates decision next week and another 75 basis points rise will be likely after Fed chairman said last week that it will act "forthrightly" to get a grip on prices. Bitcoin price is still trading within range of recent months so need to panic Bitcoin is currently trading 69% below its all-time high of $68,721. On a three-month price view (see chart below) the leading digital asset is still very much in rangebound territory. Market watchers will now be looking to see how stocks react to the latest inflation data.
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