Bitcoin holds near $64K as stocks rise on softer US producer prices

Bitcoin remained rangebound near $64,000 on Tuesday, mirroring gains in US equities after a cooler-than-expected July producer price index (PPI) report fueled bets on easing inflation pressures.

The US Bureau of Labor Statistics reported that the PPI, which measures wholesale prices, rose 0.1% month-on-month in July, below the 0.2% increase forecast by economists. On an annual basis, producer prices increased 2.2%, down from 2.7% in June and the slowest pace since October 2023. Core PPI, excluding food and energy, also fell short of expectations, rising 0.1% versus a projected 0.2% gain.

The data reinforced market expectations that the Federal Reserve may consider policy easing at its September meeting. Traders priced in a 75% chance of a 25-basis-point rate cut, according to CME Group’s FedWatch tool, up from 65% a day earlier. US stock indexes advanced, with the S&P 500 and Nasdaq Composite up 0.4% and 0.6%, respectively, by midday trading.

Bitcoin’s price action remained subdued, hovering around $64,000 after a volatile weekend that saw the cryptocurrency briefly dip below $63,000 before recovering. The digital asset has struggled to sustain momentum above key resistance levels, with traders citing macroeconomic uncertainty and mixed institutional demand as key factors. Analysts at Glassnode noted that Bitcoin’s 30-day volatility index had fallen to its lowest level since April, reflecting a period of consolidation.

Market participants remain divided on Bitcoin’s near-term trajectory, with some citing potential support from renewed institutional interest, while others warn of further downside risks if macroeconomic conditions deteriorate. The cryptocurrency’s correlation with risk assets, including equities, has strengthened in recent weeks, amplifying its sensitivity to macroeconomic data releases.

The PPI report follows last week’s softer-than-expected consumer price index (CPI) data, which also suggested a cooling inflation trend. The Federal Reserve’s next policy meeting is scheduled for September 17-18, with investors closely monitoring incoming economic indicators for further clues on the timing and magnitude of potential rate cuts.