Shiba Inu (SHIB -9.39%) is seeing big sell-offs in Tuesday’s trading. The cryptocurrency’s token price was down 8.2% over the last 24 hours — a period that also saw Bitcoin‘s price fall 5% and Ethereum‘s price fall 7.4%.
Shiba Inu is losing ground amid a significant pullback for the broader cryptocurrency market. Today’s sell-offs have been triggered by new data from the U.S. Bureau of Labor Statistics (BLS) that has raised concerns about inflationary pressures and the outlook for interest rates.
Jobs data and Treasury yields send Shiba Inu investors running
This morning, the BLS published job openings data for November. The report showed that there were 8.1 million job openings in the month, coming in ahead of the average analyst estimate’s call for 7.7 million openings in the period. Analysts had anticipated that job openings would decline slightly from the 7.7 million openings recorded in October, but the tracking unexpectedly ticked upward.
Investors are worried that the latest jobs data could be sign that higher-than-anticipated levels of economic activity will increase inflationary pressures. Along with the news, yields on U.S. Treasury bonds moved higher today.
Even on the heels of recent interest rate cuts from the Federal Reserve, the benchmark rate has been kept relatively high in order to combat inflation. If economic indicators continue coming in hot, that could be a sign that inflationary pressures are poised for a resurgence. That would likely mean that interest rates would be cut at a slower pace, which would be a bearish development for Shiba Inu and other cryptocurrencies.
What comes next for Shiba Inu?
Over the next year, macroeconomic conditions will likely be the biggest factor in determining Shiba Inu’s performance. The meme coin could bounce back and continue rocketing higher if indicators suggest that inflation is under control and there is a path for continued interest rate cuts. On the other hand, the token will likely see big sell-offs if macro conditions take a turn for the worse.
Beyond inflation and interest rate news, the rollout of the SHIB: The Metaverse platform is a coin-specific catalyst that could have some impact on the cryptocurrency’s token price. While it’s not clear whether the virtual world will garner significant engagement, the metaverse recently launched in early access and could help generate interest in Shiba Inu and encourage activity in its ecosystem.
Keith Noonan has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Bitcoin and Ethereum. The Motley Fool has a disclosure policy.
