From Cointelegraph · By William Suberg
Bitcoin (BTC) starts the third week of October by defending support at $82,500 ahead of key US inflation data.
Key points:
US CPI print on Wednesday and PPI data on Thursday provides the weekâs major risk-asset volatility catalyst, with markets seeing CPI at 3.7% year-on-year.
Oil prices react to the US plan to buy Russian diesel, but WTI crude heads higher after dropping below $90 per barrel on Monday.
Bitcoin seals a weekly close above key support at $82,500, avoiding a drop into its previous 2026 macro range between $60,000 and $80,000.
Markets see September inflation creeping higher
US inflation data is in tradersâ crosshairs this week ahead of the Federal Open Market Committeeâs Oct. 28 meeting on interest-rate policy.
The September prints of the Consumer Price Index (CPI) and Producer Price Index (PPI) will be released on Wednesday and Thursday, respectively.
In August, CPI broadly conformed to expectations at 3.4% year-on-year, with markets now seeing an uptick to 3.7% this month on the back of ongoing military action in the Middle East and associated fuel-price surges. PPI is expected at 0.3% month-on-month versus 0.2% in August.
US CPI 12-month % change by category. Source: Bureau of Labor Statistics
Crypto, stocks and gold traditionally benefit from lower-than-expected inflation readings as these reduce the odds of the Fed tightening policy, allowing for capital inflows to strengthen. Speaking to Reuters about current gold prices and US bond yields, Tim Waterer, chief market analyst at KCM Trade, drew attention to the impact of a surprise move to the downside for CPI and PPI readings in particular.
âIn the â short term, a cooler-than-expected US inflation reading would be the clearest near-term catalyst, as it âwould reduce the odds of further Fed tightening and ease pressure on real yield,â he said.
CME FedWatch shows that markets see just an 18.8% chance of a rate hike on Oct. 28 from the current 3.75-4.00% range. The following meeting, in December, is attracting 70.6% odds of the Fed hiking by 25 basis points to 4.00-4.25%.
Fed target-rate probabilities (screenshot). Source: CME Group
Fed chair Kevin Warsh is due to hold a discussion with Kristalina Georgieva, managing director of the International Monetary Fund (IMF), at an event in Bangkok, Thailand on Friday.
Oil briefly cools on US-Russia diesel announcement
US bond yields have come off 24-year highs seen last week, with the 10-year and 30-year yields at 5.24% and 5.60%, respectively, on Monday.
US 10-year bond yield one-hour chart. Source: Cointelegraph/TradingView
Stocks futures were green to start the week, with the S&P 500 index up 0.25% and around 30 points off new all-time highs.