Crypto Market Tumbles as Inflation Fears Spike

The crypto market faced a sharp downturn as Bitcoin, Ethereum, and Ripple dropped significantly following a higher-than-expected Producer Price Index (PPI) report. Bitcoin fell 3.8%, Ethereum 4%, and Ripple 6.1%, reflecting investor anxiety over rising wholesale prices, which surged 0.9% in July—the largest monthly jump since March 2022. The unexpected spike suggests persistent inflation, dimming hopes for near-term interest rate cuts by the Federal Reserve.

The inflation data has reignited concerns about economic stability, with core inflation hitting a five-month high of 3.1%. Meanwhile, political tensions flared as former President Trump clashed with economic officials over revised unemployment figures. The crypto slump extended beyond major players, with Solana, Dogecoin, and TRON also declining, though Cardano bucked the trend with a 2.3% gain.

Analysts warn that continued inflationary pressures could further destabilize markets, as institutional investors reassess their crypto bets. The Dow and S&P 500 initially dipped but recovered slightly, while the crypto sector remains volatile. With the Fed unlikely to cut rates soon, traders brace for more turbulence ahead.

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