Bitcoin holds below $70K as stocks slip despite a cooler US PPI print
Bitcoin was down about 4% on the day amid a tepid market reaction to October’s US PPI reading, which came in below expected levels.
Bitcoin experienced a decline of approximately 4% on the day amid relatively muted reactions to October's U.S. Producer Price Index (PPI) data, which fell below expectations. The cryptocurrency (BTC) remained near $68,700 after a recent rebound from a low of around $67,500. TradingView data indicated BTC/USD was down 4% on the day following its bounce from a 12-week low near $67,500. A one-hour chart of BTC/USD is available on Cointelegraph/TradingView.
The U.S. PPI, which measures changes in the prices domestic producers receive for goods and services, rose 0.3% month over month and 6.5% year over year in October. While both readings were 0.1 percentage points below market expectations, the annual increase was the highest since November 2022. The PPI for final demand goods increased by 0.5%, whereas final demand services rose by 0.2%, according to the U.S. Bureau of Labor Statistics (BLS) report.
Stock markets showed little respite at the beginning of U.S. trading, with traders still analyzing Nvidia developments following its co-founder and CEO, Jensen Huang, resigning on Thursday. The S&P 500 and the tech-heavy Nasdaq Composite Index both dropped 1.2% and 1.5% respectively by the time of writing.
The PPI release prompted a slight adjustment in market expectations for Federal Reserve rate hikes. The likelihood of a modest 25-basis-point hike at the Federal Open Market Committee (FOMC) meeting in December rose from 85.4% on Thursday to 89.7%, while the odds of a larger 50-basis-point move decreased from 14.5% to 10.3%, as per CME Group's FedWatch Tool.
Economist Robin Brooks called a 25-basis-point hike in December "all but inevitable," but argued against a steeper increase, stating it would be ineffective against current inflation drivers like the oil-price spike resulting from the U.S.-Iran war and potential long-term acceleration in underlying inflation. "If high inflation is about the Strait of Hormuz and oil, 75 basis points won't do anything about that.
If the issue is that the pace of underlying inflation has risen, then 75 basis points is much too timid to get this under control," Brooks wrote.
Crypto trader and analyst Rekt Capital warned that a close below $73,000 for Bitcoin on Sunday would signify a breakdown of support previously observed in 2026. He noted that Bitcoin had fallen to around $60,000 after each of the previous two breakdowns at $75,000, $76,800, and $78,300. BTC/USD's one-week chart is accessible on Rekt Capital's X.com account.
At the current price of $68,700, Bitcoin has experienced a 17.7% decline in the fourth quarter and an 11.2% decrease year to date, marking its second-worst quarterly performance on record, according to data from CoinGlass.
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