Hot US PPI Sinks US Stocks as Stagflation Fears Return

January's Producer Price Index (PPI) came in hotter than anticipated, with the year-over-year figure at +2.9% against a +2.6% forecast, and core PPI surging to +3.6% versus +3.0% expected. This higher-than-expected wholesale inflation data immediately pressured US equities, causing the S&P 500, Dow Jones, and Nasdaq to drop significantly. The core beat was largely driven by a +0.8% month-over-month rise in core PPI, more than double the +0.3% forecast, primarily due to a surge in trade services margins. This inflation surprise reduces the likelihood of near-term Federal Reserve rate cuts, increases yields, and pressures risk assets like Bitcoin. The situation raises fears of stagflation—rising producer costs concurrent with slowing GDP growth—which severely limits the Fed's policy flexibility.

(Source：BeInCrypto)