At the start of the week, Bitcoin continues to trade below the psychologically important $80,000 mark. Pressure in the monetary policy cauldron has risen again due to solid US labor market data. The recently friendly sentiment in the crypto market should not obscure the fact that monetary policy and geopolitical risks remain a central factor of uncertainty.
On the other side, hopes for sustainable political tailwinds from the US do not cease.
At the same time, in the coming days investors are focusing in particular on the publication of important US price data. The ECB's key interest rate decision could also provide important momentum.
Bitcoin price chart on a monthly basis
Regulation still in focus - Midterm elections cast shadows ahead
A few weeks after the crypto summit at the White House, the recent euphoria has given way to a sober perspective. Market participants are now obviously expecting more concrete steps regarding regulation, particularly concerning the so-called "Clarity Act." In addition, the US midterms will take place on November 3, during which the House of Representatives and parts of the Senate will be re-elected. US President Donald Trump might potentially woo the crypto industry, much like he did during his election campaign.
Monetary policy back in focus – US inflation data casting shadows ahead
Monetary policy developments could once again exert a stronger influence on trading activity this trading week.
As early as Thursday (2:30 PM), US producer prices could provide important inflation signals. Economists expect a 0.4 percent increase compared to the previous month, following 0 percent in July.
On Friday afternoon, the focus will be in particular on US inflation data, which investors are expected to examine for monetary policy clues (2:30 PM). A rate of 3.4 percent compared to the same month last year is expected, following 3.4 percent in July as well.
„Fed Watch Tool“ signals increased chance of interest rate cut at September meeting
According to the CME Group's „FedWatch Tool,“ 60.4 percent of market participants expect a total rate hike of a quarter of a percentage point to a range of 3.75 to 4.00 percent, and 39.6 percent expect a rate pause at the next scheduled meeting on September 16, 2026.
The European Central Bank's (ECB) interest rate decision is scheduled for Thursday at 2:15 PM. At 2:45 PM, ECB President Christine Lagarde will follow with the subsequent press conference.
The prospect of globally rising capital market interest rates could increase the opportunity costs of holding non-interest-bearing assets like Bitcoin, thus making them less attractive.
