Market comment on behalf of Ramy Zeytouni market analyst at Ramy Zeytouni LLC
Bitcoin was broadly steady on Wednesday as traders awaited the September US CPI and reassessed the latest Federal Reserve signals. A softer tone from policymakers has reduced expectations for tightening beyond this year, allowing Treasury yields to ease and providing modest support to the cryptocurrency. New York Fed President John Williams still sees scope for one more hike in 2026 but little justification for further increases next year, while Governor Christopher Waller reinforced the case for a more gradual approach.
Markets continue to assign roughly a 20% probability to an interest rate increase this month, although one hike by year-end and further tightening over the coming months remain priced in. Unless those expectations shift materially, short-dated yields could remain supported, limiting Bitcoin’s upside. At the long end of the curve, persistent concerns over the US fiscal outlook could also prevent Treasury yields from falling significantly. Expectations of further monetary tightening from the Bank of Japan could add another headwind.
Institutional demand remains inconsistent. Spot Bitcoin ETFs attracted USD 175.7 million on Tuesday, but the last five sessions combined still show net outflows of USD 597.6 million. Today’s CPI release could change that dynamic by triggering a stronger repositioning among large investors. Without a sustained return of institutional demand, any rebound could struggle to gain traction.
Today’s CPI release, with headline inflation expected to rise, is likely to set Bitcoin’s near-term direction. A hotter-than-expected print could strengthen the case for faster tightening, lifting short-dated yields and weighing on Bitcoin. A clear downside surprise could instead bring the year-end hike into question, pull yields lower and improve the backdrop for risk assets.
Zaid Barem / ymm
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