Bitcoin Falls Below $77,000 as US PPI, Oil and Bond Yields Pressure Risk Assets
Key Takeaways
- •Bitcoin fell below $77,000 and was on course for a 2% daily loss amid weakness in US equities.
- •WTI crude rose above $100 per barrel and Brent crude moved above $105 as Middle East tensions intensified.
- •The US 30-year Treasury yield reached 5.353%, its highest level since June 2007, while the 10-year yield climbed to 4.924%.
- •August US PPI increased 5.4% year over year, exceeding expectations by 0.1 percentage points, with July’s reading revised higher.
- •CME FedWatch data showed a 69.8% probability of a 0.25% Fed rate hike at the Sept. 16 meeting, up from 61.2% the prior day.
Bitcoin (BTC) fell below $77,000 around the Wall Street open on Thursday as renewed macroeconomic pressures weighed on risk assets. The decline followed hotter-than-expected US producer inflation, a surge in oil prices linked to escalating Middle East strikes and a sharp rise in long-term US Treasury yields.
Bitcoin was on track for a 2% daily loss, according to TradingView, amid weakness in US equities.
US bond yields rise despite $6 billion Treasury buyback
WTI crude oil rose above $100 per barrel for the first time since May 21 as the ongoing escalation in the Middle East drove a fresh increase in energy prices. Brent crude also moved above $105 per barrel, approaching a new 16-week high.
The rise in oil prices added to inflation concerns as US long-term bond yields broke higher. The move came despite the Treasury carrying out the first of its expanded debt-buyback operations and repurchasing $6 billion worth of Treasurys on Wednesday.
The US 30-year Treasury yield reached 5.353%, its highest level since June 2007. The 10-year yield climbed to 4.924%, marking its highest level since November 2023.
Trading resource The Kobeissi Letter warned that elevated borrowing costs could have knock-on effects for both the government and consumers.
“The bond market is quite literally fighting the US Treasury,” The Kobeissi Letter wrote in a post on X.
Hot US PPI data adds to crypto’s macro pressures
The August Producer Price Index (PPI) showed that inflation had increased. The index rose 5.4% year over year, coming in 0.1 percentage points above expectations. July’s headline PPI reading was also revised higher.
PPI measures changes in the prices received by domestic producers and is one of the inflation indicators markets monitor alongside consumer-price data. Its hotter reading, combined with higher energy prices and Treasury yields, kept attention on whether inflationary pressure could affect the outlook for US interest rates.
In an official news release, the US Bureau of Labor Statistics said: “The index for final demand less foods, energy, and trade services rose 0.3 percent in August after moving up 0.4 percent in July. For the 12 months ended in August, prices for final demand less foods, energy, and trade services advanced 4.7 percent.”
Market expectations for a Federal Reserve interest-rate hike increased after the data. The CME Group FedWatch Tool showed a 69.8% probability of a 0.25% hike at the Fed’s Sept. 16 meeting, up from 61.2% the previous day.
Concerns about tighter Fed policy had already increased following stronger-than-expected nonfarm payrolls data, as previously reported by Cointelegraph. The US Consumer Price Index (CPI), due Friday, will be the final major inflation report released before the Fed’s rate decision.
The European Central Bank also enacted a 0.25% hike on Thursday, its second such move in 2026.
Related: Bitcoin sell-side risk returns to rare lows as $80K sellers fade from view
Source: Cointelegraph
