Why did Bitcoin rise today? Trump and Powell's dispute triggered a risk-off wave, and PPI pushed prices above 96,000.

Bitcoin breaks through $96,000, driving a surge in related stocks. MicroStrategy soars over 8%, Metaplanet gains 15% in Tokyo stock market. Trump launches criminal investigation against Federal Reserve Chair Powell, sparking investors to shift towards safe-haven assets such as Bitcoin, gold, and silver. November PPI jumps to 3.0%, far exceeding expectations of 2.7%, with inflationary pressures heating up and reinforcing Bitcoin’s narrative as an inflation hedge.

Trump-Powell Dispute Sparks Rush into Safe-Haven Assets

The primary reason for Bitcoin’s rise today is directly linked to the US political crisis. According to David Morrison, senior market analyst at Trade Nation, a criminal investigation into Powell was initiated last Friday, which triggered cautious sentiment among investors. The escalating dispute between President Trump and Federal Reserve Chair Powell continues to raise concerns over central bank independence, posing potential risks in trading.

In a report Wednesday morning, Morrison wrote: “The overall tone indicates that investors are increasingly worried about recent domestic policy measures, especially the clear threats to the Fed’s independence and the growing influence of the US internationally.” Although the stock market suffered heavy losses, Bitcoin, altcoins, and precious metals rebounded as investors sought safe havens.

A significant divergence among asset classes is emerging. Tech stocks continue to lag, with the Invesco QQQ Trust (QQQ), tracking the Nasdaq 100, falling over 1% today, remaining roughly flat for the year, while Bitcoin has risen about 10% in the same period. Metals markets continue to perform strongly, with gold trading near $4,600 per ounce and silver above $91 per ounce, both potentially reaching $5,000 and $100 respectively.

Luke Otuñuga, senior market analyst at FXTM, stated: “Geopolitical and trade policy uncertainties, along with concerns over central bank independence, dominate market sentiment. The market is influenced by multiple factors. Despite the fragility of risk assets, safe havens like gold and silver continue to perform well. As key legal and political decisions are imminent, market volatility may remain high.”

PPI Data Surge Reinforces Inflation-Hedging Narrative

(Source: Truflation)

The second driver behind Bitcoin’s rise today is inflation data exceeding expectations. November PPI data shows producer prices increased by 3.0% annually, well above the 2.7% forecast, reaching the highest level since July 2025. Monthly producer price index (PPI) rose as expected by 0.2%, but the annual increase accelerated to 3.0%, indicating persistent producer-level price pressures that could eventually pass through to consumer prices.

The importance of the unexpected PPI fluctuations lies in the fact that producer prices are a leading indicator of consumer inflation—wholesale cost increases typically lag behind retail prices. The monthly rise was mainly driven by a 0.9% increase in the prices of final demand goods, while final demand services prices remained unchanged. Final energy demand rose 4.6% in November, with gasoline prices soaring 10.5%, accounting for over half of the total increase.

Yesterday’s December CPI data showed overall inflation remained at 2.7%, with core inflation at 2.6%, both well above the Federal Reserve’s 2% target. Today’s PPI data again indicates inflationary pressures persist. High producer prices and ongoing consumer inflation create a scenario where Powell warns of “higher interest rates lasting longer.”

Market analyst Bullish warned: “The US November PPI data came in above expectations at 3%, versus 2.7%. This suggests core inflation is heating up.” The core Producer Price Index (PPI) increased by 3.5% annually, the largest 12-month gain since March. The higher-than-expected reading indicates inflation is accelerating again, potentially complicating the Fed’s easing policy path.

Inflation Data’s Triple Impact on Bitcoin

Strengthening Inflation-Hedging Narrative: PPI surge validates Bitcoin’s role as a tool against currency devaluation

Delayed Rate Cuts Expectations: Persistent high inflation keeps the Fed at high interest rates longer, reinforcing Bitcoin’s scarcity advantage

Dollar Confidence Wavers: Ongoing inflation pressures weaken the dollar’s purchasing power, prompting investors to seek alternative stores of value

After analyzing November’s PPI data, Truflation noted: “Although the Producer Price Index (PPI) shows strong inflation, our Consumer Price Index (CPI) data still reveals many deflationary trends, especially in energy and housing.” However, markets are more focused on the acceleration of PPI potentially translating into sustained consumer price pressures.

Institutional Buying and Technical Breakthroughs Resonance

(Source: Trading View)

The third reason for Bitcoin’s rise today is strong institutional buying support. During early US trading hours, Bitcoin’s price continued upward, reaching as high as $97,000, boosting related stocks. MicroStrategy (MSTR), the largest Bitcoin asset manager, saw its stock rise over 8%, KindlyMD (NAKA) up 10%. Asia’s largest Bitcoin company, Metaplanet, surged 15% in Tokyo stock market. Strive (ASST) increased 7%, following shareholder approval of its acquisition of Semler Scientific (SMLR).

These strong performances of related stocks indicate institutional investors are actively increasing their Bitcoin exposure. Strategy, as the world’s largest corporate Bitcoin holder, saw its stock surge, reflecting market confidence in Bitcoin’s long-term value. Metaplanet’s sharp rise in Tokyo also shows strong demand for Bitcoin in Asian markets.

On the technical side, Bitcoin remains around $96,700, with support levels between $88,000 and $90,000, and resistance at $92,000. A fall below $90,000 could trigger a new decline toward the November low of $88,500; however, holding above $95,000 suggests the market has fully priced in the Fed’s cautious stance. Bitcoin is poised for further gains, with approaching key milestones making the $100,000 target increasingly prominent.