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US PPI data once again shows the stickiness of inflation, and Bitcoin plunges nearly 6% during the session

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Are macro risks returning to the market?

Original title: "US PPI data once again shows the stickiness of inflation, and Bitcoin plunges nearly 6% intraday"

Original author: Mary Liu, BitpushNews

On March 14, U.S. stocks and crypto markets fell back after another higher-than-expected inflation data.

The U.S. producer price index (PPI) rose 0.6% month-on-month in February, higher than the 0.3% expected by economists. Sticky inflation seems to have suppressed investor sentiment. Major U.S. stock indexes fell on hopes a rate cut was imminent. The S&P 500 fell 0.3%, the Dow Jones Industrial Average fell 0.4% and the tech-heavy Nasdaq Composite fell 0.3%.

The crypto market fluctuated downwards. Bitcoin was close to US$73,800 on Thursday morning. It plunged more than 6% after the release of economic data, once falling below US$69,000, and then bought The market intervened to promote the rebound, and it rose back to around US$70,500 as of press time.

Many analysts pointed out , Bitcoin may enter a period of consolidation, even if a 20% retracement is possible, as the momentum of setting new highs over the past two weeks begins to wane.

Major altcoins Ethereum, XRP, MATIC and AVAX fell 5%-7% intraday today, recovering some of their losses as of press time.

Solana’s native token (SOL) has performed strongly amid the market downturn, hitting its highest price in 26 months before the correction. SOL rose 5% throughout the day, reaching an intraday high of $173.81, making it one of the best-performing assets among the top 10 cryptocurrencies.

Digital Asset Hedge Fund QCP Capital said in a market update on Thursday that SOL has benefited from a capital rotation as Bitcoin's rally appears to have stalled.

Cryptocurrency trader Bob Loukas expects SOL to rise further towards $250, having broken through key resistance.

Meanwhile, Dogecoin gained nearly 20% after Elon Musk hinted that Tesla is willing to add Dogecoin as an official payment method. 10%.

Have macro risks returned to the market?

Investors have been paying close attention to inflation recently, and this week's data appears to be affecting their expectations for when and how often the Federal Reserve will cut interest rates this year.

Earlier this week, the Consumer Price Index (CPI) was also higher than expected, with annual inflation rising to 3.2% and the core rate rising to 3.8%.

The 10-year Treasury yield fell below 4% earlier this month and has now risen to 4.30%. Meanwhile, the dollar has also broken out of a downtrend that began in mid-February, gaining about 1% over the past week, including a 0.5% gain on Thursday.

All other things being equal, rising interest rates and an appreciating U.S. dollar tend to have a negative impact on risky assets like Bitcoin.

Financial commentator Tedtalksmacro predicts on X that the Fed will keep interest rates "higher for longer" on the back of data. But he also said: "I think macroeconomics is secondary to current market drivers compared to institutional flows."

The next meeting of the Federal Open Market Committee (FOMC) is scheduled for March 20, and no rate cut is expected .

According to the latest estimates from the CME FedWatch tool, as of this writing, the probability of an FOMC rate cut in May is only 6.2%, and the probability of a rate cut in June is less than 60%. %.