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US Inflation Data Triggers Selloff in Gold, Crypto, Stocks
US producer prices rose 0.4% in August, pushing gold and bitcoin lower as rate hike expectations increased.
10/09/2026 14:5610 min read
On Thursday, September 10, a fresh US inflation reading came in hot, dragging down markets across the board — gold, bitcoin, and the S&P 500 all declined.
Even gold, conventionally seen as a safe haven, failed to serve as an inflation buffer. The bond market has recently shown that inflation hedges may falter when price increases bring higher interest rates along with them.
Gold's Role as Inflation Hedge Fails
In August, US producer prices increased by 0.4%, in line with predictions. The year-over-year figure came in at 5.4%, a touch above the anticipated 5.3%.
U.S. 🇺🇸 PPI & JOBLESS CLAIMS:
— Wall St Engine (@wallstengine) September 10, 2026
PPI 5.4% YoY, (Est. 5.3%)
PPI 0.4% MoM, (Est. 0.4%)
Core PPI 4.6% YoY, (Est. 4.6%)
Core PPI 0.2% MoM, (Est. 0.3%)
Initial Jobless Claims 206K, (Est. 205K)
The theory says gold should gain when inflation erodes purchasing power. In reality, spot gold (XAU/USD) slid more than 1%, moving down toward $4,350 after previously holding above $4,400.
Forex traders felt the pain of that decline. One standard gold lot equals 100 ounces, so a $100 drop translates to approximately $10,000 in losses on a single long contract, before accounting for trading expenses.
The bond market inflicted the most harm. The 10-year Treasury yield climbed above 4.9%, a level not seen since October 2023, while the 30-year yield hit around 5.35%.
With yields rising, cash and government bonds become more appealing. Gold generates no yield, and neither does bitcoin.
Following the data, CME FedWatch probabilities shifted to a 70% likelihood of a September rate increase, up from about 62%.
Why Rising Inflation Weighed on Gold
The specifics within the release were significant. According to the Bureau of Labor Statistics: “Prices for final demand goods advanced 1.1 percent, and the index for final demand services increased 0.1 percent.”
Energy accounted for over three-quarters of the rise in goods prices, giving the report the appearance of an energy shock rather than widespread inflation.
September Fed hike odds rise to 56% after PPI comes in slightly hotter than expected. https://t.co/xBgJWqJSzR pic.twitter.com/T6Ex2MJDI5
— Shay Boloor (@StockSavvyShay) September 10, 2026
The US dollar gained strength as expectations of a rate hike increased, creating an additional headwind for gold priced in dollars.
BeInCrypto noted earlier this week that Treasury yields approaching 5% might begin to vie with bitcoin and gold for institutional investment.
Friday's US CPI report is the next major event. If it also comes in hot, the Fed will face stronger pressure to raise rates, testing how much further “inflation hedges” can drop when inflation itself is the source of trouble.
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Disclaimer: this article comes from third-party media and is provided for reference only. It does not constitute investment advice. Crypto and other financial products carry significant price volatility risk, so please make your own decisions carefully.
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