September PPI inflation jumped to 6.3% year over year, far above the 5.4% forecast. Core PPI rose 5.0% against 4.4% expected. Hot producer prices raise the odds of another Fed hike, which lifts yields and pressures risk assets like Ethereum. As I write, ETH trades near $2,350, down about 5% in 24 hours.
The September PPI Numbers
The Producer Price Index (PPI) tracks the prices businesses receive for their goods and services. In other words, it shows cost pressure before that pressure reaches shoppers. This month, the pressure came in hard.
- Headline PPI: +1.3% MoM vs +0.6% expected
- Headline PPI: 6.3% YoY vs 5.4% expected
- Core PPI: +0.7% MoM vs +0.3% expected
- Core PPI: 5.0% YoY vs 4.4% expected
August PPI ran at 5.4% YoY, so this is a big step up. Energy drives much of it. Diesel hit a record $6.53 per gallon on September 22, and producers pass those costs along slowly. Therefore, more price pressure may still sit in the pipeline.
Retail sales added to the heat. They rose 0.8% in September against 0.3% expected, and August was revised to 1.1%. Consequently, prices keep climbing while consumers keep spending. That mix is the worst case for anyone hoping for rate relief.
Why Hot PPI Hurts ETH
The Fed raised rates to 3.75% to 4.00% on September 16. So every inflation print now feeds the question of another hike. Before CPI, FedWatch priced about a 22% chance of a hike on October 28. After CPI, that number jumped to roughly 30% to 45%, depending on the hour. Meanwhile, a December hike already sat near 90%. Today’s data points the same way, and hike odds are rising sharply.
Higher hike odds lift Treasury yields and the dollar. The 10-year yield touched about 5.3% after CPI. I covered the dollar’s climb in my dollar 18-month high post. Leveraged traders feel these moves first. After CPI, more than $106M in ETH longs got liquidated on Binance within an hour.
ETH also fell harder than Bitcoin. ETH dropped about 5% in 24 hours, while BTC lost about 2.4%. ETH tends to swing more on macro shocks, and it has struggled to hold $2,500 for weeks. For the full CPI reaction, read my CPI 3.7% breakdown.
ETH Levels I’m Watching
Price sits right on a key zone. The 100-day moving average and horizontal support both land near $2,350. Here is the map:
- Support: $2,350 to $2,355, then $2,300, then $2,200
- Resistance: $2,498 (50-day EMA), $2,548, then about $2,563 (20-day EMA)
If $2,350 breaks, $2,300 is the next stop. Below that, $2,200 comes into play. On the other hand, a reclaim of $2,500 would show buyers stepping back in. For now, the daily trend still leans bearish. New to reading levels like these? Start with my market structure guide.
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My Trades After the PPI Print
Yesterday’s longs all closed at my entry. They hit take profit first, so each trade finished green. However, I gave back a decent part of that profit on the way back down.
Right now, my only open trade is a CATE long. I have no ETH position.
If I trade ETH, I will look for a long from this region. My short-term target is $2,500, with $2,600 as a stretch. First, I am watching volume and order flow for a clean entry. If I enter, I will post it on X.
Gold Is Under Pressure Too
Gold tells the same story. It fell to about $4,070 after CPI, then bounced to around $4,150 as yields eased. Even so, gold sits roughly 26% below its January record near $5,600. It also slid from about $4,700 in late August.
War headlines usually support gold. However, rising rate-hike odds have outweighed that bid this month, because gold pays no interest. As a result, bullion and ETH move for the same reason: fear of more hikes. For gold, I watch $4,100 as support and $4,200 as resistance.
What Comes Next
Fed Chair Kevin Warsh speaks next, and traders will hunt for hints about October 27 and 28. A hawkish tone would add to the pressure on ETH and gold. A softer tone could give both a breather.
After that, the Fed meeting itself is the real test. PCE inflation follows right after it. Therefore, I expect more volatility until the Fed shows its hand.
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Final Words
September PPI hit 6.3% against 5.4% expected, and core PPI hit 5.0%. Retail sales beat too. Together, those prints raise the odds of another Fed hike. ETH sits on $2,350 support, and gold is holding near $4,100. I let price show its hand before I act.
FAQ
What was the September 2026 PPI number?
Headline PPI rose 6.3% year over year, versus 5.4% expected. Monthly PPI rose 1.3% against 0.6% expected. Core PPI rose 5.0% YoY and 0.7% MoM.
Why does PPI affect crypto prices?
PPI shows how much cost pressure producers face. Hot PPI raises Fed hike odds, so yields and the dollar rise. Consequently, risk assets like crypto often fall.
Will the Fed raise rates in October?
Hike odds for October 27 and 28 jumped after CPI and are rising again after PPI. A December hike is priced even higher. Check the live FedWatch reading before you trade.
Why did Ethereum fall more than Bitcoin?
ETH usually reacts more strongly to macro shocks. Besides that, heavy long liquidations added to the drop.
Why is gold falling when inflation is rising?
Higher inflation raises hike odds, and hikes lift yields. Gold pays no interest, so higher yields make it less attractive.
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