"U.S. July PPI Explodes" Bitcoin Long Wick Candle at $117,000, Trump Tariffs Ring the Inflation Alarm, Will The Federal Reserve Cut Rates in September?"

U.S. July PPI rose 0.9%, the largest increase in three years, as Trump's tariffs raised costs, prompting the market to reassess the Federal Reserve's rate cut in September, leading to a widespread decline in the cryptocurrency market. (Background: Bitcoin surged to $124,500, setting a new all-time high! Ethereum approached $4,800.) (Additional context: Bitcoin broke through $121,400, 'Get Liquidated 370 million'; Tom Lee: will surge to $250,000 by year-end.) The U.S. Department of Labor released the July Producer Price Index (PPI) last night (14th) with data showing a month-on-month increase of 0.9% and a year-on-year increase of 3.3%, which not only far exceeded market expectations but also rewrote the record for the largest single-month increase in three years. This report immediately disrupted Wall Street's expectations for cooling inflation and quickly reversed the already fragile rate cut expectations, driving declines in the U.S. stock market and cryptocurrency market. Rising production costs put pressure on PPI to transmit to the consumer side. PPI is often regarded as a leading indicator of the consumer price index (CPI) because the costs borne by the production side ultimately fall on retail prices. July data showed service costs rose 1.1%, with trade profits increasing by 2.0%, portfolio management fees jumping 5.8%, and airfare and hotel prices rebounding by 3.1%. At the same time, commodity costs also rose by 0.7%, with price increases seen across food, metals, and electronic components, indicating that this wave of inflation is not a singular spike but a structural spread. With tariffs exacerbating labor shortages, the market quickly focused on the tariff measures of the Trump administration. The tariffs on steel and aluminum directly raised raw material costs, and the intensified crackdown on undocumented immigrants led to a shortage of agricultural labor, resulting in a staggering 38.9% increase in the cost of fresh and dried vegetables. High Frequency Economics chief economist Weinberg pointed out: For those who believe tariffs will not affect domestic prices in the U.S., this report is like a heavy blow. JPMorgan economist Hansen also warned that the rise in wholesale prices will take longer to fully reflect in the consumer end, implying that there is still a risk of CPI rising in the short term. The Federal Reserve's dilemma: is the rate cut window forced to be delayed? The unexpected surge in PPI has sounded the alarm for global investors: wholesale cost pressures are returning, adding uncertainty to the Federal Reserve's policy direction. In the coming months, whether CPI will follow suit and rise, and whether Trump’s tariff negotiations can ease, are key factors influencing capital flows. If prices continue to remain high while economic growth slows, the market will more frequently mention 'stagflation.' On the other hand, the July PPI report has also narrowed the choices for the Federal Reserve's monetary policy. Fedwatch data showed that the market originally expected a 2 basis point rate cut in September, but after the data was released last night, that expectation dropped to zero. However, currently, there is still a 92.1% chance of a 1 basis point rate cut, and investors can only closely monitor upcoming economic data. Bitcoin Long Wick Candle at $117,156. As for the cryptocurrency segment, Bitcoin plummeted immediately after the data was released, hitting a low of $117,156 at midnight and reporting $118,360 before the deadline. At the same time, ETH also fell below $4,500, but has just returned above $4,600, showing significant rebound momentum. Related reports: Tom Lee predicts Bitcoin will reach $250,000 by year-end; why is market attention shifting to Bitcoin Hyper and other L2 projects? DAT Digital Vault rises: from holding Bitcoin to yield management. Chinese A-share aunties shout for cryptocurrency: Bitcoin is digital gold, Ethereum is a Web3 powerhouse, SOL is the leader in blockchain gambling. <U.S. July PPI explosion> Bitcoin Long Wick Candle at $117,000, Trump tariffs sound the inflation alarm, will the Federal Reserve still cut rates in September? This article was first published in BlockTempo, the most influential blockchain news media.