Bitcoin Climbs as U.S. PPI Inflation Comes In Below Expectations

The Bitcoin price has rebounded following the release of the October PPI inflation report, with the data coming in below expectations. As a result of the lower-than-expected reading, crypto traders have also pared back bets on potential Fed rate hikes over the coming months.

Bitcoin Rebounds as PPI Inflation Rises Below Expectations

The BTC price has rebounded to as high as the psychological $70,000 level from a low of around $69,000. The leading crypto is trading at around $69,800, still down more than 3% on the day, according to TradingView data.

Bitcoin’s rebound follows the release of the PPI inflation data, which came in below expectations. According to the U.S. Bureau of Labor Statistics, the index rose 6.5% year over year in October, below expectations. Month over month (MoM), the index rose 0.3%, below expectations of 0.4%.

Meanwhile, the core PPI came in line with expectations at 0.3% and 5.0%, MoM and YoY, respectively. This marks a positive for Bitcoin and the broader crypto market following the release of the CPI inflation data earlier this week, which came in above expectations, raising forecasts of a potential 50-basis-point December Fed rate hike.

It is worth noting that, besides concerns about a Fed rate hike, other factors are currently pressuring the crypto market. This includes the recent decline in the stock market, particularly for AI stocks. The MSCI has also decided to remove BTC treasury firm Strategy from its global indexes, raising concerns about what this could mean for the company and its treasury strategy.

Traders Pare Bets On a 50 Bps Hike

Crypto traders have reduced their bets on a 50 bps December Fed rate hike following the release of the PPI inflation data. Data from the top crypto prediction market platform, Polymarket, shows a 6% chance the Fed will hike rates by 50 bps next month, down from as high as 10%.

However, the Fed is still expected to raise rates by at least 25 bps at next month’s FOMC meeting. Further data from Polymarket shows a 92% chance that there will be a 25 bps rate hike following the meeting.