Crypto Markets Drop As US PPI Inflation Spikes To 5.4%

Bitcoin, Ethereum, and XRP faced heavy selling pressure on Thursday after fresh economic data showed U.S. inflation running hot. The Producer Price Index jumped to 5.4 percent, catching economists off guard and sparking new fears about the broader economy.

Markets reacted swiftly to the inflation report. Traders now price in a 74 percent chance that the Federal Reserve will raise interest rates at the upcoming policy meeting on September 15 to 16. Higher rates usually reduce investor appetite for risk assets, which puts immediate pressure on the crypto sector.

This pullback highlights how sensitive digital assets remain to traditional macroeconomic indicators. Traders should monitor upcoming central bank speeches and employment data to gauge market direction as the Fed meeting approaches.