KEY POINTS
- October final-demand PPI rose 0.3%, while the measure excluding food, energy and trade services rose 0.5% for a second month.
- Diesel prices fell 7.9%, but truck freight prices rose 3.9% and drove most of the increase in services prices.
- US Bitcoin ETFs recorded $284.1 million in net outflows on Nov. 12, according to Farside Investors data cited by CryptoSlate.
US wholesale inflation slowed in October, but the details of the report make it harder to argue that cheaper fuel will quickly ease financing conditions for Bitcoin holders, CryptoSlate reported. Bitcoin was trading below $70,000 at the time.
The Bureau of Labor Statistics published its October producer-price report on Nov. 13. It showed diesel prices down 7.9%, while truck freight prices climbed 3.9%. Final-demand PPI rose 0.3% on a seasonally adjusted basis, following a revised 1.4% increase in September.
The measure that excludes food, energy and trade services rose 0.5% for the second month in a row. Its annual rate eased to 4.9% from 5%, whereas headline annual PPI picked up to 6.5% from 6.3%. CryptoSlate described the picture as mixed: some comparisons improved, but monthly underlying pressure stayed firm.
The BLS said truck freight accounted for more than 80% of the 0.2% rise in final-demand services prices. Transportation and warehousing services increased 2%, even though final-demand energy prices slipped 0.1%. Goods prices rose 0.5%. In the outlet's reading, cheaper diesel has not yet translated into cheaper transport.
There was some evidence for a more optimistic view. Prices for unprocessed intermediate goods fell 3.1%, and both monthly headline inflation and the annual core-style measure eased. The open question, according to the report, is whether that cooling spreads and lasts.
The Federal Reserve was also in focus. Before the day's consumer price data, Governor Christopher Waller leaned toward a 25-basis-point rate increase in December if conditions developed as expected. He said a 50-basis-point move should be considered if October core CPI came in near the prior two readings of about 0.3% or higher. The CPI report then showed a 0.4% monthly headline rise and a third straight 0.3% gain excluding food and energy.
CryptoSlate explained that lower financing costs could make borrowed Bitcoin exposure easier to carry and might encourage investors to take more risk. But it noted that persistent inflation could keep policy restrictive even when a single fuel price falls. PPI tracks the selling prices producers receive, CPI tracks prices paid by consumers, and the Fed targets PCE inflation, so the readings are not interchangeable.
On the demand side, Farside Investors data showed US Bitcoin ETFs had net outflows of $284.1 million on Nov. 12, before the PPI release. The outlet said sustained inflows would be firmer evidence of returning buyers, while continued underlying inflation and further withdrawals would weaken the case for a financing-driven recovery, even if diesel keeps getting cheaper.
