U.S. PPI Surges to Two-Year High, PCE Inflation Eases; Stocks Rally, Crypto Volatile

The U.S. Producer Price Index (PPI) for January surprised markets with a higher-than-expected growth rate, reaching a nearly two-year high. However, key Personal Consumption Expenditures (PCE) inflation indicators favored by the Federal Reserve showed a monthly decline, easing inflation concerns. The market's overall reaction to this PPI report was dovish.

U.S. stocks broadly rose on Thursday, with tech stocks leading the rally. The S&P 500 rose by 1.04%, the Dow rose by 0.77%, and the Nasdaq rose by 1.50%. Large-cap tech stocks, semiconductor stocks, and AI concept stocks saw widespread gains.

The cryptocurrency market remained volatile, with Bitcoin attempting to reach near $98,000 but failing to hold its ground. It eventually stabilized near $96,000, with market sentiment leaning cautious. In the altcoin space, the lack of unified consensus guidance has led to investor confidence issues and thin trading volumes, with funds continuing to flow out. However, the BSC ecosystem and related MEME tokens are becoming a new market focus.

In the commodities market, the U.S. dollar weakened by 0.63% as Trump's reciprocal tariffs will not be implemented immediately. Market expectations of a possible Russia-Ukraine peace agreement led to a volatile oil market on Thursday, with a slight closing decline. A weaker U.S. dollar supported gold prices, with spot gold rising by 0.87% in the closing moments, approaching the historic high set on Tuesday.

Following unexpectedly high CPI inflation data, the U.S. January PPI remained robust, reaffirming the significant price pressure the U.S. faced before the Trump administration implemented tariffs. The advancement of Trump's tariffs has intensified market concerns about future inflation. The probability of the Fed cutting interest rates this year is also on the rise.