Bitcoin’s October Outlook Hinges on Fed and Inflation Data

Bitcoin kicked off October near $85,000 after a weaker-than-expected U.S. jobs report eased concerns about further Federal Reserve rate hikes. The September employment data showed nonfarm payrolls rising by just 29,000, with unemployment at 4.2%, fueling speculation that the Fed might pause its tightening cycle at its October 27-28 meeting. While Bitcoin briefly surged above $87,000 on the news, it later settled back toward the mid-$80,000s.

The Fed’s decision will hinge on additional economic data, particularly inflation figures due out on October 14 (consumer prices) and October 15 (producer prices). The most critical report, however, will be the September PCE price index, released on October 29, one day after the Fed’s meeting. A pause in rate hikes could boost Bitcoin, but a hotter-than-expected inflation reading could quickly reverse any gains.

ETF inflows played a key role in September’s rally, with spot Bitcoin funds seeing significant net inflows. However, the first days of October showed mixed results, including a $148.7 million outflow on September 30 and a $102.7 million inflow on October 1. The sustainability of this demand will be crucial for Bitcoin’s ability to reclaim higher levels, such as $90,000 to $100,000.

Fidelity’s Jurrien Timmer added to the optimism, stating that Bitcoin has entered a new bull market and could reach $300,000 by 2029. However, he cautioned that sustained spot demand will be necessary to support further gains, as the market continues to reassess inflation and monetary policy.