The Core Personal Consumption Expenditures (PCE) inflation reading came in at 2.9%, aligning with expectations and reinforcing market anticipation of Federal Reserve interest rate cuts. Polymarket traders maintained 81% odds for a 25 basis point reduction at the October 29 FOMC meeting following the release.
Analysts highlighted the positive implications for risk assets. Jake Kennis, senior research analyst at Nansen, noted: "Cooler inflation readings [2.7% to 2.9%] often boost risk assets like BTC and ETH as they suggest potential Fed dovishness and lower real yields." Fabian Dori, CIO at Sygnum Bank, added context, stating the data confirms gradual easing of price pressures but leaves policymakers balancing sticky inflation with a softer labor market.
Bitfinex analysts pointed to derivatives market dynamics, with $18 billion in Bitcoin options expiring on September 26. They identified key technical levels, including a $115,200 pivot and $120,000 cluster, warning that a break below could trigger a sell-off. Support holding could lead to a post-expiry rally driven by call options.
Macroeconomic data revisions showed 911,000 fewer jobs created between April 2024 and March 2025—the largest downward adjustment since 2002—with summer payroll growth averaging just 29,000 monthly, below the break-even for unemployment stability. This, combined with the September FOMC's 25 basis point cut and projections for further easing, strengthens the case for accommodative policy, benefiting assets like cryptocurrencies.