US Producer Inflation Slows to 5.5% in June as Bitcoin Stays Above $65,000

US producer prices fell in June, undercutting forecasts that inflation pressures would keep building. The Producer Price Index (PPI) slipped 0.3% month over month, while the annual rate cooled to 5.5%, well below the 6.2% consensus estimate and down from 6.0% in May. Bitcoin held firmly above $65,000 in the immediate reaction. Beneath the headline, the data showed a sharp pullback in goods prices. Goods declined 1.4% on the month, led by a steep drop in energy. Energy prices fell 6.4%, with gasoline down 12.0% in June. Services prices edged up 0.2%. Core final demand PPI, excluding food, energy and trade services, rose 0.1% month over month. On a year-over-year basis, core PPI stood at 5.1%. The producer-side cooling follows recently softer Consumer Price Index readings, a pattern that can eventually ease inflation pressures faced by households. Even with the slowdown, a 5.5% annual PPI remains elevated compared with pre-pandemic trends. Producer inflation also remains well below its 2022 peak, when annual PPI growth topped 10%, marking continued progress in the Federal Reserve's effort to rein in inflation through tighter monetary policy. For markets, the softer PPI print reinforced a familiar risk-asset dynamic. Cooling inflation data tends to lift expectations for eventual Fed rate cuts, reducing the appeal of holding cash and bonds and supporting higher-return assets, including crypto. Investors are still watching key risks. Energy prices are volatile, and the gasoline-driven decline could reverse quickly if supply disruptions or geopolitical shocks emerge. Traders are also monitoring the divergence between falling goods prices and rising services costs, which could leave the Fed with a more mixed inflation picture than the headline suggests. Policymakers will weigh both CPI and PPI readings ahead of the next policy meeting.