① The first inflation data since the US government shutdown will be released this Friday (October 24), and analysts currently expect the market to react moderately; ② Some analysts point out that the data itself may not have a significant impact, as investors' attention remains focused on the uncertainty of tariffs and trade policies; ③ As for how Bitcoin will respond, analysts believe that investors are currently in a defensive posture and are hedging against potential risks.
Bitcoin and the financial markets as a whole are awaiting the first inflation data since the US government shutdown, and analysts expect the market to react moderately.
The Consumer Price Index (CPI) is scheduled to be released this Friday (October 24), and the data will have a key impact on the Federal Reserve's interest rate decision next week.
Tim Sun, a senior researcher at digital asset financial services firm HashKey Group, noted, "Bitcoin and the market as a whole are expected to react modestly to this week's major macroeconomic events. Given the slowdown in job growth and stabilizing demand, even a slight increase in the consumer price index is unlikely to substantially alter market expectations."
"If U.S. inflation is in line with expectations, with only slight deviations, then the most likely outcome is a muted market reaction," said Derek Lim, head of research at cryptocurrency market maker Caladan.
Inflation forecast
This report is set to be released amid significant economic uncertainty. The government shutdown, which forced the postponement of the September non-farm payroll report, has further clouded market expectations regarding the labor force. Analysts generally predict that overall U.S. inflation will rise from 2.9% to 3.1% in September.
Sun, however, believes the most likely outcome is that inflation will "grow slightly or remain flat," which aligns with the narrative of gradually easing inflation.
He also suggested that the data itself might not have a significant impact, as investors' attention remains focused on the ongoing uncertainty surrounding tariffs and trade policies. "A slight inflation surprise is unlikely to trigger a large-scale sell-off, as the inflationary effects of tariff adjustments are already priced in."
Sun concluded, "The Fed is more focused on the overall trend of inflation than on individual data points."
Has Bitcoin bottomed out?
With the market still in a state of uncertainty, Friday's inflation data will test whether Bitcoin can remain stable during the shutdown.
As data release approaches, the cryptocurrency market appears more vulnerable than traditional stock markets. Currently, Bitcoin is trading 11% below its all-time high of $122,500 reached on October 10th, a day marked by a black swan event that saw a price crash triggered by news of sudden trade frictions, resulting in a massive $19 billion liquidation.
In contrast, Standard & Poor's The 500 index is only 0.37% away from its recent high, suggesting that investors have a stronger risk appetite for stocks.
Furthermore, with large outflows of funds from major Bitcoin and Ethereum ETFs (exchange-traded funds), market sentiment has fallen into panic territory. Derek Lim points out that investors are currently on the defensive and hedging against potential risks.
(Article source: CLS)
