The soft inflation data of the United States for August are, at least temporarily, boost the highest cryptography prices on early Wednesday.
The Producer Price Index (PPI)that measures inflation at the wholesale level, fell 0.1% month by month in August, compared to analysts estimates of a 0.3% increase and the 0.9% increase in the previous month. Year after year, PPI grew by 2.6%, below 3.1%before and sharply lower than the forecasts for 3.3%.
The central PPI, which eliminates food and energy costs, also fell 0.1% in August Verus to the 0.3% increase and the increase of July 0.7%. The central PPI year after year increased only 2.8% compared to estimates of 3.5% and 3.4% in July.
The reaction in cryptographic markets was fast, with Bitcoin Increasing to $ 113,700 at the time of publication, later in more than 1% in the last 24 hours. Ether (Eth) Rose for a similar amount and sun of solana (SUN) It continues a recent higher yield, 3.3% to $ 224.
This last PPI reading followed the increase in Julio PPI that revived inflation concerns in the midst of a labor market that weakened rapidly. The merchants will monitor the tomorrow’s consumer price index (CPI) Inflation report, a key data point to evaluate before the decision of the FED interest rate next week.
“Those are exactly the PPI data that we must encourage, assuming that it will help to suppress the inflation of the CPI, put an end to the recent streak of reinflation and allow the Fed to be explicitly concentrated on the recent weakness of the labor market,” said Caleb Franzen, founder of cubic analytics, in a post X.
Bulls are right for caution
In equal conditions, it is generally supposed to be easier for monetary policy for risk assets, crypto among them.
Last month he has seen the president of the Federal Reserve, Jerome Powell, go from Hawk to Dove and now a series of weak economic reports that possibly point to the need for a series of cuts of central banks. And yet, Bitcoin has fought, increasing as Powell’s news or reports hit, but then they retire quickly.
Bitcoin’s price action has been particularly disconcerting since gold has behaved exactly how investors could expect, which pushes what seems like a new record with each fresh burning news.
While merchants continue to overwhelmingly waiting for the FED to reduce rates at 25 basic points at their policy meeting next week, bets have increased in a possible movement of 50 basic points. According to CME Fedwatch, the probabilities of a 50 -point cut have now increased to 10% compared to 7% before the PPI and 0% report a week ago.
