US Producer Prices Slide 0.3% in June; Bitcoin Retakes $65,000 as July Fed Hike Bets Fade

US producer-price inflation fell 0.3% in June, marking the first month-on-month decline since August 2025. The cooler print helped lift risk assets, with Bitcoin (BTC) back above $65,000 and Ethereum (ETH) clearing $1,900 as traders pared expectations for a Federal Reserve rate hike at the end of July. The producer-price report followed a softer-than-expected consumer inflation reading the prior day, pushing market pricing more firmly toward a pause rather than additional tightening. Bureau of Labor Statistics data showed headline PPI rose 5.5% year over year, below the 6.2% consensus. Core PPI slowed to 4.7% versus a 5.2% forecast. May's monthly increase was revised down to 0.6% from 1.1%. The 0.3% month-on-month drop in June was the steepest since April 2025. Energy led the decline. Gasoline prices fell 12%, accounting for nearly two-thirds of the 1.4% drop in final-demand goods. Even after the pullback, gasoline prices were still nearly 43% higher than a year earlier. Services were steadier, with trade margins up 0.4%. In rates markets, CME FedWatch now implies an 87.7% probability the Fed keeps its target range at 3.50% to 3.75% at the July 29 meeting, leaving just a 12.3% chance of a hike. A week earlier, markets had assigned about a 31% probability to an increase. The Fed held rates unchanged in June at Chair Kevin Warsh's first meeting, citing inflation risks tied to artificial-intelligence spending. In testimony the day before the PPI release, Warsh said the central bank has "No tolerance for persistently elevated inflation." Crypto markets reacted quickly. Bitcoin traded around $65,256 after the data, up 2.5% over 24 hours. Ethereum rose 3.6% to about $1,930, its first move above $1,900 since early June. The rally triggered roughly $100 million in crypto short liquidations within 30 minutes. Traders are also watching whether the disinflation momentum can hold. Much of June's relief came from gasoline, while crude has moved above $85 after President Donald Trump announced a Strait of Hormuz blockade on Monday. The route carries about one-fifth of global oil flows, raising the risk that higher energy costs could re-accelerate inflation as soon as next month. For Bitcoin, the next technical hurdle is the $66,000 resistance area that has capped advances since mid-June.