Bitcoin broke above $65,000 on Wednesday morning at 8:30 a.m. EDT, jumping after the release of a softer-than-expected U.S. Producer Price Index report for June. The move lifted stock futures, gold, and major cryptocurrencies, while oil prices held near multi-year highs on lingering Middle East supply concerns.
The Bureau of Labor Statistics reported that the June Producer Price Index rose 0.2% month over month, below the 0.3% economists had projected. On an annual basis, PPI stood at 6.5%, with the Consumer Price Index at 3.5% over the same period.
The cooler inflation reading immediately shifted rate expectations. According to market pricing, the implied probability of a Federal Reserve rate hike dropped to 16%, reducing the pressure on risk assets that had been weighed down by tightening fears.
Bitcoin Leads Crypto Advance
Bitcoin’s breach of the $65,000 threshold represents a key psychological level, driven by the combination of lower inflation data and renewed appetite for alternative assets. The digital asset’s move coincided with gains in equity index futures and a rise in gold prices, as traders rotated into assets seen as beneficiaries of a less aggressive monetary policy stance.
Gold, traditionally a hedge against inflation and currency debasement, also attracted bids in the wake of the PPI release, reinforcing the narrative that a softer inflation trajectory could pave the way for a more accommodative Fed.
Oil Offers a Cautionary Note