Markets turn uneasy as fresh inflation data tests Wall Street’s confidence

The United States Producer Price Index (PPI) rose 0.3% in September, exactly in line with economist expectations, an outcome that has given crypto markets some relief, contributing to a modest upward move across major assets.

The Producer Price Index (PPI) measures the prices that businesses pay for goods and services before they reach consumers.

Think of it as inflation at the factory level. If producer costs rise, those increases can eventually show up in consumer prices (CPI). If producer costs cool, it can signal that broader inflation pressures may ease.

PPI matters because it helps economists predict future inflation trends — and the Federal Reserve uses those trends to decide whether to raise, cut, or hold interest rates.

What the latest PPI data means

The new report showed:

• PPI rose 0.3% in September

• The result was exactly as expected

• Energy and food costs drove the increase

• Core PPI (excluding food and energy) was softer than forecasts

This is what economists call a “no surprises” inflation report.

A predictable PPI reading means the Fed has no new reason to accelerate or slow rate cuts. Markets prefer this because they hate uncertainty.

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Wall Street and Polymarket lean toward fewer cuts

Deutsche Bank, in a fresh note, said its base case remains a 25-basis-point cut in December, followed by an extended pause that could last until Q3 2026.

In its latest “DB Fed Watcher” note, the bank argues that while inflation is easing, the Fed will be reluctant to move quickly without clearer, sustained disinflation.

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Goldman Sachs echoed the December-cut view, expecting the Fed to ease again before year-end as the labor market continues to cool. Analysts there pointed to softening employment data as justification for one more reduction before the Fed steps back.

That outlook stands in contrast to Morgan Stanley and JPMorgan, both of which dropped their December cut calls after the stronger-than-expected jobs report earlier this month.

Polymarket, crypto-based prediction platform traders overwhelmingly expect a 25-basis-point cut in December, pricing the odds near 85%. Only around 13% of bettors see the Fed holding rates steady, while a 50-bps cut sits near zero probability.

Bitcoin, XRP trades slightly higher

Bitcoin (BTC) held steady after the data, trading within a narrow band as macro-sensitive flows remained muted.

The crypto market’s calm follows a broader trend: rate cuts have not been reliably bullish in 2024-2025.

The global crypto market cap sits at $3.07 trillion, up 1.6% on the day as major assets trade slightly higher. Bitcoin (BTC) is hovering near $86,885 after a 1.6% rise, while Ether (ETH) has gained 3.8% to reach $2,909. XRP (XRP) is the standout performer among large-caps, jumping 5.9% to $2.20 and extending its weeklong momentum.

At the previous Federal Reserve meeting, the central bank cut rates by 25 basis points — yet Bitcoin fell below roughly $109,000 and the global crypto market cap dropped under $4 trillion.

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This story was originally published by TheStreet on Nov 25, 2025, where it first appeared in the Federal Reserve & FOMC News section. Add TheStreet as a Preferred Source by clicking here.