Bitcoin fell below $77,000 around Thursday’s Wall Street open as hotter-than-expected US producer inflation, rising oil prices and a jump in Treasury yields tightened pressure on risk assets. TradingView data showed BTC/USD heading for a decline of roughly 2% on the day while major US stock markets also moved lower.
The sell-off put Bitcoin in the middle of a fast-changing macroeconomic repricing. The US Producer Price Index for August exceeded forecasts, oil returned above $100 per barrel and long-dated Treasury yields rose to levels not seen since before the 2008 financial crisis. Together, those moves strengthened expectations that interest rates could remain elevated for longer than markets had recently anticipated.
Producer inflation raises pressure ahead of CPI
The US Bureau of Labor Statistics reported that headline producer prices rose 5.4% year over year in August, 0.1 percentage point above the market forecast cited in the supplied data. The report also included an upward revision to July’s headline PPI reading.
Underlying price pressures remained firm. The index for final demand less food, energy and trade services increased 0.3% in August after rising 0.4% in July, the Bureau of Labor Statistics said. That measure was up 4.7% over the 12 months through August.
Producer prices do not translate directly into consumer inflation, but elevated costs for manufacturers, wholesalers and service providers can complicate the Federal Reserve’s effort to bring inflation under control. The August reading arrived one day before the scheduled release of the Consumer Price Index, leaving markets to assess whether consumer inflation will also show renewed upward momentum.
CME Group’s FedWatch Tool showed the implied probability of a 25-basis-point Federal Reserve rate increase at the Sept. 16 meeting rose to 69.8% after the PPI release, from 61.2% a day earlier. The CPI report is the last major US inflation release before that decision.
Oil surge adds to the inflation problem
Energy markets added another layer of concern. West Texas Intermediate crude rose above $100 per barrel for the first time since May 21 after renewed escalation in the Middle East, according to the supplied market data. Brent crude traded above $105 per barrel and approached a 16-week high.
Higher oil prices feed into transport, manufacturing and household energy costs, while also lifting the headline inflation measures followed by consumers and policymakers. The development places the Federal Reserve in a more difficult position: easing financial conditions through lower rates becomes harder to justify if energy-driven inflation is accelerating.
Bitcoin has often traded as a high-volatility macro asset during periods when rate expectations are shifting quickly. When yields rise, government debt offers higher income with comparatively low credit risk, raising the return that traders demand from assets such as Bitcoin, growth equities and other speculative markets.
Treasury yields climb despite buyback
US government bond yields continued moving higher even after the Treasury Department conducted a $6 billion debt buyback on Wednesday. The operation did not reverse the broader bond-market move.
The 30-year Treasury yield reached 5.353%, its highest level since June 2007, while the benchmark 10-year yield climbed to 4.924%, the highest since November 2023, according to the supplied market data. Because bond yields move inversely to prices, the rise signaled continued selling pressure in longer-dated Treasurys.
Long-term yields carry particular weight for financial conditions because they affect borrowing costs across mortgages, corporate debt and other credit markets. Their ascent also signals that traders are demanding greater compensation to hold US government debt over long periods, whether because of inflation concerns, fiscal supply or expectations for policy rates.
The European Central Bank added to the global backdrop of restrictive monetary policy by raising its key rates by 25 basis points on Thursday, its second increase of 2026. Markets were already processing stronger US nonfarm payrolls figures before the PPI release, limiting the case for an imminent turn toward easier monetary policy.
Bitcoin faces a data-driven volatility test
The next major test is Friday’s CPI release. Bitcoin’s drop below $77,000 came before that data point, meaning price action could remain sensitive to even modest deviations from inflation forecasts.
The supplied article cited historical market records showing that Bitcoin price movement in the first 30 minutes after a core inflation release has been about 1.8 times normal levels. It also cited prior instances in which inflation readings above expectations coincided with immediate daily Bitcoin declines of between 3.5% and 4.2% over the past two years. Such comparisons do not establish a fixed response pattern, but they underline how closely digital-asset markets are watching US macroeconomic data.
Bitcoin’s ability to hold or recover the $77,000 area will likely depend less on cryptocurrency-specific developments than on whether Friday’s CPI report relieves or reinforces inflation concerns. A softer result could lower the perceived chance of further Fed tightening; another upside surprise would likely keep yields and the dollar supported, conditions that have weighed on risk-sensitive assets.
On-chain profitability remains below Glassnode’s cited bull-market threshold
On-chain data offered a more mixed picture than the immediate macro sell-off. Glassnode reported that 71% of Bitcoin’s active supply was held at an unrealized profit. The blockchain analytics firm’s historical framework places the average threshold associated with the start of a new bull-market phase at 74.7%.
That gap suggests that a large share of the market remains profitable, but the metric has not yet reached the level Glassnode associates with stronger broad-based momentum. In the near term, Friday’s CPI release and the Federal Reserve’s September decision are likely to carry more weight for Bitcoin than on-chain profitability measures, especially while oil prices and Treasury yields continue to rise.
Wondering if this pullback is a buying chance? Explore our outlook in Should you buy Bitcoin while it’s still over $70,000?
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