The Producer Price Index (PPI) for January rose 0.4%, exceeding economists' forecasts of 0.3% and up from 0.2% in December. On a year-over-year basis, PPI increased by 3.5%, which was higher than expected, with estimates around 3.2% and 3.3% for December. The core PPI, excluding food and energy, also saw a 0.3% rise, meeting forecasts but up from 0% in December. Following the data release, the price of bitcoin fell to approximately $95,800, impacted by anticipation of new Trump tariffs. These PPI figures take on increased importance after a surprising Consumer Price Index (CPI) report showed stronger inflation than expected, prompting Federal Reserve Chairman Jerome Powell to call for additional efforts to curb inflation. Following significant rate cuts late in 2024, the Fed signaled a pause in further monetary easing until inflation or economic conditions notably improve. Markets had adjusted expectations to only one rate cut for 2025 before the PPI data was released.

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