Key takeaways
- US annual producer inflation reaches four-year high
- Nasdaq drops despite cooler-than-expected monthly inflation
- Bitcoin approaches $68,000 as Fed tightening fears persist
US producer inflation accelerated to 6.5% annually in October, its highest level since November 2022, as persistent price pressures and renewed technology-stock selling weighed on the Nasdaq and Bitcoin on Friday, November 13.
The Producer Price Index (PPI) increased 0.3% month over month, below economists' 0.4% forecast and sharply slower than September's roughly 1.3%–1.4% increase. However, the annual rate climbed from 6.3%, indicating that inflation remains elevated despite the monthly slowdown.
US PPI Reaches 6.5% as Inflation Remains Elevated
The latest producer-price figures, released by the Bureau of Labor Statistics, showed annual wholesale inflation rising to its highest level in nearly four years.
Core PPI, excluding food and energy, increased 0.3% monthly and 5% annually, matching economists' expectations. The readings followed an earlier US consumer inflation surprise, when October CPI rose 0.4%.
Food costs increased 1.3%, while truck freight prices climbed approximately 3.9%. Demand associated with artificial intelligence data-center construction also contributed to higher prices for electronic components and industrial chemicals.
Economists now anticipate that core Personal Consumption Expenditures inflation, the Federal Reserve's preferred underlying inflation gauge, could reach approximately 3.2% annually.
That outlook adds to existing December Fed rate hike expectations, although the central bank has not committed to another increase.
Nasdaq Drops 1.4% as Nvidia Crisis Deepens
US stocks initially reacted positively to the below-consensus monthly inflation reading, with S&P 500 futures climbing approximately 0.6% and Nasdaq-100 futures gaining 0.5%.
However, the rally reversed during regular trading. By midday, the Nasdaq Composite had fallen approximately 1.4%, while the S&P 500 declined 0.9%.
The losses extended the previous session's Nvidia-led market selloff, following CEO Jensen Huang's unexpected departure.
Semiconductor stocks faced particularly heavy selling, with Nvidia dropping more than 3% and the Philadelphia Semiconductor Index declining approximately 6%.
Meanwhile, the 10-year Treasury yield hovered around 5.13%, keeping pressure on valuations and financing costs.
The combination of persistent inflation and technology-sector uncertainty has complicated Wall Street's attempts to recover from the recent correction.
Bitcoin Falls Toward $68K as Gold Faces Higher Yields
Bitcoin traded near $68,500 during Friday's session, extending a decline that has intensified concerns about leveraged cryptocurrency positions.
The cryptocurrency's latest weakness follows warnings about Bitcoin futures liquidation risks and substantial institutional selling.
US spot funds had already recorded approximately $1.3 billion in Bitcoin ETF withdrawals during the previous week, weakening a major source of demand.
Gold has also struggled to maintain its safe-haven appeal. The metal recently fell below $3,900 as rising Treasury yields increased the opportunity cost of holding non-yielding assets.
