Global financial markets are focused on the US Consumer Price Index (CPI) data to be released today, with the September inflation figures expected to be decisive for Bitcoin and overall risk appetite. The data is also closely watched in terms of expectations regarding the Federal Reserve’s future interest rate policy.
For Bitcoin, the critical point is not just whether the inflation data is above or below expectations, but how the data will change expectations regarding the Fed’s interest rate policy.
If inflation, particularly core CPI, falls below expectations, markets may support the expectation that the Fed may pause interest rate hikes at its October meeting. In such a scenario, downward pressure on US bond yields and the dollar could support demand for risky assets, especially Bitcoin.
Conversely, stronger-than-expected inflation data could increase pressure on the Fed to maintain tighter monetary policy and strengthen the likelihood of a rate hike at the October 28 meeting. In such a scenario, rising US bond yields and the dollar could create short-term selling pressure on Bitcoin.
At this point, the probability of a rate hike in October is priced at 21.6%, while the probability of keeping it unchanged is priced at 78.4%, while the US September inflation data, which the Fed closely monitors when making its interest rate decisions, has been released.
Here are the US inflation figures that have been released:
Consumer Price Index Annual: Announced 3.7% – Expected 3.6% – Previous 3.4%
Consumer Price Index Monthly: Announced 0.6% – Expectation 0.6% – Previous 0.4%
Core Consumer Price Index Annual: Announced 2.6% – Expected 2.5% – Previous 2.4%
Core Consumer Price Index Monthly: Announced 0.3% – Expectation 0.2% – Previous 0.3%
The consumer price index is a key variable used to measure consumer purchasing trends and changes in US inflation.
Bitcoin’s Initial Reaction After the CPI Data!
*This is not investment advice.
