Cryptocurrency Bitcoin Maintains Close to $114,000 Amidst US Inflation Spike to 2.9%
The European Central Bank (ECB) has announced that it is holding interest rates steady following its meeting on September 11, 2025. This pause in rate changes comes after the ECB kept rates unchanged in the previous meeting, with the next rate decision scheduled for October 30, 2025.
Currently, there is no clear public indication that the ECB will announce a rate cut at the next meeting, as the inflation rate was close to target (2.1%) in August 2025. The ECB has recently paused rate changes, indicating a cautious approach towards monetary policy.
Across the Atlantic, the focus is on the Federal Open Markets Committee (FOMC), which is scheduled to meet next week. According to recent surveys, 9% and 12% of investors expect a 50 basis point Fed rate cut next week, while a majority of users on Myriad predict a more modest 25 basis point cut.
The FOMC's decision could have significant implications for the market, with the more decisive event for asset classes remaining September's FOMC meeting. The discussion on the pace of future rate cuts is expected to be the key driver.
Meanwhile, the U.S. economy is facing challenges from rising tariff costs and food prices, which could continue to push inflation higher. Analysts at crypto exchange Bitunix have flagged these factors as a source of continued pressure. If consumer price index (CPI) comes in above expectations, markets may reassess the scope for future rate cuts and even begin to worry about stagflation risks in the U.S.
In contrast, the ECB is looking at different macro data than its U.S. counterparts. Service-sector inflation in the U.S. shows signs of rebounding, according to analysts at Bitunix, while the ECB's assessment of the inflation outlook is broadly unchanged.
In other news, Bitcoin ETF flows hit an 8-week high, and Bitcoin was flirting with $114,000 this morning. The market reaction to yesterday's producers price index was muted, with the DXY, a financial benchmark that measures the value of the U.S. Dollar against major foreign currencies, slipping again to 97.69 after briefly recovering from a touch of 97.80.
Mark Wall, chief European Economist at Deutsche Bank, expects the ECB to stay the course for a while, suggesting that the ECB may not follow the FOMC's lead in lowering interest rates. Analysts at QCP Capital expect any volatility from the consumer price index print to be short-lived.
As the global economy navigates these challenges, the focus remains on central banks and their monetary policy decisions. The ECB's steady hand and the FOMC's anticipated rate cuts will shape the financial landscape in the coming months.
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