TL;DR
- Bitcoin and Ethereum both gained over the past 24 hours following the release of September’s CPI report, which showed U.S. inflation at 3%, slightly below economists’ 3.1% forecast.
- Core inflation also eased to 3%, supporting optimism around potential Fed interest rate cuts.
- Traders reacted positively, with Bitcoin reaching $111,358 and Ethereum climbing to $3,970, reflecting renewed confidence in crypto assets as the U.S. economic outlook shows signs of moderation.
Bitcoin and Ethereum rose Friday after the U.S. Bureau of Labor Statistics reported consumer prices increased 3% year-over-year in September, marginally below expectations of 3.1%. The report, delayed by the ongoing government shutdown, provided markets with a glimpse of cooling inflation and renewed hopes for supportive Federal Reserve policy. Market analysts also noted that growing investor interest in technology-driven financial platforms may amplify crypto volatility in the coming weeks.
Bitcoin changed hands at $111,358, marking a 2.13% gain in 24 hours and a market capitalization of $2.21 trillion. Ethereum advanced to $3,970, up 3.16% over the same period, with a market cap of $478.94 billion. Other major cryptocurrencies, including Solana, also recorded modest gains, as traders assessed broader macroeconomic trends.
Market Sentiment Shifts With Inflation Data
The September CPI indicated core inflation, which excludes food and energy, dropped to 3% from 3.1% in August. Monthly price pressures were driven largely by gasoline, which rose 4.1%, and modest gains in food, shelter, and healthcare. The slower-than-expected increase in overall prices contributed to optimism that the Fed may reduce interest rates in its next policy meeting.
Investors on prediction platforms signaled a cautious tilt toward “Greed”, reflecting confidence that crypto markets could benefit from lower borrowing costs and easing inflation. Despite persistent uncertainty from U.S.-China trade tensions and the 24-day government shutdown, crypto markets responded positively, with analysts highlighting that the CPI data could reinforce bullish sentiment for risk assets.
Fed’s Rate Decisions Could Support Crypto Recovery
The Federal Reserve is widely expected to reduce rates by 0.25% at its upcoming meeting, with December rate cuts still anticipated at 88% probability. Fed Chair Jerome Powell emphasized a meeting-by-meeting approach, balancing inflation and employment goals. The moderated inflation readings strengthen expectations that the Fed can cautiously ease policy, which may provide continued support for Bitcoin, Ethereum, and other cryptocurrencies in the coming weeks. Investors are closely monitoring both domestic and international economic signals, including technology adoption rates and institutional interest in blockchain assets.
