- Bitcoin climbed above $116,000 as weak U.S. jobs data and softer inflation fueled expectations of a Fed rate cut.
- Ether also gained, with institutional inflows highlighting strong investor confidence in crypto assets.
Bitcoin briefly crossed $116,000 on Friday, driven by growing expectations of a Federal Reserve interest rate cut. Softer inflation readings and weaker job market data have shifted investor sentiment, lifting risk assets across the board and boosting cryptocurrencies like Bitcoin and Ether.
Fed Shifts Focus Toward Growth Support
Fresh U.S. economic data has signaled that the Fed may soon ease monetary policy. Earlier this week, producer price index data showed a surprise decline of 0.1%, defying expectations of a 0.3% increase. While consumer prices showed modest acceleration, the uptick was not significant enough to derail bets on monetary easing.
Adding to the shift, the Bureau of Labor Statistics revised down employment figures for the 12 months through March 2025, erasing nearly 900,000 jobs. This revision suggested that the labor market is weaker than previously believed. According to Greg Magadini, director of derivatives at Amberdata, this combination of inflation stability and employment weakness is pushing the Fed toward prioritizing growth over price stability.
He noted that the conditions increase the chances of a 50-basis-point rate cut either next week or at the October meeting.
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Bitcoin and Ether Benefit from Market Optimism
As speculation around Fed action builds, Bitcoin has attracted strong inflows, highlighting its growing role as a hedge in uncertain times. Gadi Chait, investment manager at Xapo Bank, described the current backdrop as “almost ideal” for Bitcoin, citing the balance between sticky inflation and weakening employment.
Bitcoin rose more than 1% to top $116,000, while Ether gained 2.5% to reach $4,519. The broader crypto market added 1.5%, pushing its total value to $4.1 trillion. Weekly jobless claims rising to 263,000 only reinforced expectations of imminent rate cuts.
Institutional Inflows Highlight Growing Confidence
Institutional demand continues to support the rally. On September 11, spot Bitcoin ETFs recorded $553 million in net inflows, marking the fourth consecutive day of gains. Ethereum ETFs also drew $113 million, extending their streak to three days.
Whether the Fed opts for a quarter- or half-point cut, Bitcoin is increasingly seen as a unique portfolio asset. Investors are turning to it for protection against both currency risks and macroeconomic uncertainty, further strengthening its place in the financial system.
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