Bitcoin has surged above $114,000, marking its highest level since August 24, as the latest US Producer Price Index (PPI) data showed a significant cooling in inflation. The PPI dropped to 2.6% year-over-year in August, below the expected 3.3%, while core PPI fell to 2.8%, against a 3.5% forecast. This unexpected decline in inflation has increased market expectations for a Federal Reserve interest rate cut in September. The cooling inflation data, coupled with a recent revision of US jobs data that erased 911,000 jobs from the past year, has strengthened the case for imminent rate cuts. Historical trends suggest that while initial turbulence may follow such cuts, Bitcoin could see longer-term gains. Onchain metrics like Market Value to Realized Value (MVRV) and Whale Ratio indicate potential volatility but also hint at a favorable liquidity environment for Bitcoin's continued rise.