Key Takeaways
- Bitcoin retreated to $77,189 following stronger-than-anticipated US PPI figures of 5.4%, pushing Federal Reserve rate hike probability to approximately 72%
- WTI crude oil breached the $100 per barrel threshold for the first time since May 21, intensifying inflationary pressures
- The 30-year US Treasury yield climbed to 5.353%, marking its highest point since June 2007
- Spot Bitcoin ETFs experienced $283 million in net withdrawals, extending a three-day outflow streak
- Coinbase’s Brian Armstrong expressed his view that Bitcoin has reached the low point of its present four-year market cycle
Bitcoin slipped beneath the $77,000 threshold Thursday as a convergence of elevated inflation readings, climbing crude prices, and escalating Treasury yields weighed on risk-sensitive assets.
The leading digital currency by market capitalization declined 1.76% to $77,189, responding to the Bureau of Labor Statistics’ release of the August Producer Price Index (PPI) report.
The headline PPI registered at 5.4% on an annual basis, marginally exceeding the 5.3% consensus forecast. July’s numbers also underwent upward revision, intensifying strain on markets already apprehensive about Friday’s forthcoming Consumer Price Index (CPI) data.
Market expectations for a Federal Reserve rate increase surged following the release. Data from the CME FedWatch Tool indicates that the likelihood of a 0.25% rate increase at the September 16 FOMC gathering climbed to nearly 72%, advancing from approximately 64% prior to the PPI announcement.
Energy markets contributed additional downward pressure. WTI crude oil surpassed $100 per barrel for the first occurrence since May 21, fueled by escalated military tensions between the United States and Iran concerning the Strait of Hormuz. Brent crude similarly advanced, exceeding $105 per barrel.
Treasury Yields Climb to Decades-Long Peaks
US Treasury yields posted significant gains throughout the session. The 30-year maturity yield advanced to 5.353%, a threshold unseen since June 2007. The 10-year benchmark yield touched 4.968%, representing its highest reading since November 2023.
This yield surge occurred notwithstanding a $6 billion debt buyback program implemented by the US Treasury. Market commentary platform The Kobeissi Letter observed on X: “The bond market is quite literally fighting the US Treasury.”
Meanwhile, the European Central Bank implemented a 0.25% rate increase Thursday, representing its second rate hike of 2026.
Spot Demand Weakens as ETF Withdrawals Continue
Cryptocurrency analyst Ted Pillows cautioned on X that Bitcoin spot market demand has declined to levels comparable to when BTC traded at $69,000, stating: “Either spot buyers need to do the lifting, or the price will inevitably drop to $70,000.” His observations underscore mounting apprehension among market participants monitoring demand indicators.
Spot Bitcoin ETFs registered $283 million in net withdrawals on September 10, as reported by Wu Blockchain on X. This represented the third consecutive trading session of net outflows from Bitcoin exchange-traded products.
Blockchain analytics further revealed that Bitcoin sell-side risk has contracted to historically low levels, with sellers at the $80,000 price point largely disappearing from the market.
During an interview with Bloomberg Television in Singapore, Coinbase CEO Brian Armstrong stated his personal conviction that Bitcoin has reached the trough of its ongoing four-year cycle. He further noted that cryptocurrency regulatory frameworks are advancing positively, characterizing the Clarity Act as “right on the finish line” in Senate proceedings.
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