PPI on Thursday and CPI on Friday will shape whether the Fed hikes or holds on September 16. Futures markets now lean toward a rate hike, reversing last week’s bet on no change. Bitcoin is ho
The week of September 7 hands crypto traders two inflation reports in quick succession, both arriving days before the Federal Reserve sets interest rates on September 15 and 16. The Bureau of Labor Statistics publishes August producer prices on Thursday and August consumer prices on Friday, each at 8:30 a.m. Eastern. The European Central Bank delivers its own rate decision on Thursday as well. These releases will resolve a question that has divided the market over the past week: whether the Fed delivers its first hike since it began cutting or leaves rates steady at 3.50% to 3.75%.
Producer prices come first, and they tend to move ahead of the consumer number because they track costs at the wholesale level before those costs reach store shelves. A hot PPI on Thursday would lift expectations for a hot CPI the next morning, so the two prints often trade as a pair. Consumer prices carry the most weight. The July report already showed headline inflation running at 3.4% over the year, well above the Fed’s 2% goal, and August is the last full inflation reading policymakers see before they meet. Core CPI, which strips out food and energy, is the figure the Fed watches most closely for the underlying trend. Economists and prediction markets see August CPI landing near 0.2% to 0.3% on the month, firm enough to keep the hike case alive. A hike would move the target range up to 3.75% to 4.00%.
THE WEEK THAT DECIDES THE FEDMON · SEP 7 US and Canada holiday. Markets are closed for Labor Day, and thin liquidity can exaggerate price swings.
THU · SEP 10 ECB rate decision and US PPI for August. The ECB is expected to hold at 2.00%; producer prices give the first read on pipeline inflation.
FRI · SEP 11 US CPI for August. Headline and core consumer inflation, the main input for the September 16 Fed decision.
TUE–WED · SEP 15–16 FOMC decision. The Fed sets the target rate and publishes fresh projections, steering risk assets into quarter-end.
The shift happened fast. A week ago, futures tied to the Fed funds rate pointed to a hold, with roughly a 60% chance of no change and a 40% chance of a hike. A firmer-than-expected August jobs report reversed that. By September 7, the CME FedWatch tool, which reads these probabilities from Fed funds futures pricing, showed a 60.4% chance of a quarter-point hike, 39.6% for no change, and no chance of a cut. Behind the move sits an inflation picture that refuses to cool. Renewed U.S. strikes on Iranian targets pushed Brent crude back above $96 a barrel, and higher energy costs feed directly into the numbers the Fed is trying to bring down. Strong hiring stacked on top of sticky prices is the combination that pushes a central bank toward tightening rather than easing.
Source: CME’s FedWatch tool The European Central Bank reports a few hours before the U.S. producer data, and it is widely expected to leave its policy rate at 2.00%. The decision reaches crypto through the currency channel. An ECB that sounds more hawkish or more dovish than expected moves the euro, and the euro is the largest component of the U.S. dollar index, the DXY. When the dollar strengthens, dollar-priced assets like Bitcoin usually face a headwind, since it takes more of a stronger currency to buy the same coin. A surprise in Frankfurt can therefore move crypto before a single U.S. figure prints.
The Crypto Fear and Greed index, which blends volatility, volume, momentum and social signals into a single score from 0 to 100, sits at 73, inside “Greed” territory. Readings that high usually mean positioning is crowded on the long side, which leaves less room for good news to lift prices and more room for a sharp unwind if the data disappoints. Bitcoin is trading near $80,000 after briefly reclaiming the level earlier in the month, and that round number now acts as a psychological line traders watch for support, the price zone where buyers have recently stepped back in. A break of $80,000 puts the early-September low near $76,600 back in view. Elsewhere the rally has run narrower and louder. Zcash pushed above $1,000 to its highest level in nearly a decade, helped by inflows into Grayscale’s new spot Zcash fund, while Hyperliquid’s HYPE token set a fresh record near $89.50. Those moves show appetite for risk is alive, though they also concentrate the gains in a small group of names.
Institutional demand has switched back on, according to data from Farside Investors. Across the 13 trading sessions from August 19 to September 4, U.S. spot Bitcoin ETFs pulled in roughly $3.78 billion on positive days against about $438 million of outflows, a net intake near $3.34 billion. BlackRock’s IBIT did most of the pulling, absorbing the bulk of daily inflows while the smaller funds stayed flat or drifted. That buying follows a rough year for Bitcoin, which has slid from its October 2025 peak above $126,000 toward $80,000, and steady accumulation at these lower prices points to larger allocators adding rather than trimming. Flows can turn on a dime around data, so one hot CPI is enough to interrupt the run.
PeriodTotal inflowsTotal outflowsNet flowAug 19 – Sep 4, 2026+$3,780.6m−$438.4m+$3,342.2m US spot Bitcoin ETFs, 13 trading sessions. Source: Farside Investors.Two clean scenarios sit in front of the market. If CPI comes in soft, the case for a hold strengthens, yields and the dollar likely ease, and risk assets including crypto get room to breathe. If the number runs hot and the Fed hikes on September 16, borrowing costs rise, the dollar tends to firm, and leveraged positions in the more speculative alts face the first squeeze. The reaction rarely waits for the decision itself. Most of the repricing happens in the minutes after CPI prints on Friday, when traders adjust their bets before policymakers even sit down.
The rate call is only half of what lands on September 16. The Fed also publishes an updated set of projections that day, including the dot plot that maps where each official expects rates to sit over the next two years, and a single hike paired with a signal of more to come would read very differently from a one-off adjustment. Two of this week’s biggest movers may break from the macro script entirely. Zcash is trading on inflows into its freshly launched ETF and a violent short squeeze rather than on Fed odds, and Hyperliquid’s token is riding buybacks and supply burns tied to its own protocol revenue. Both could keep running, or reverse, on their own catalysts no matter what the inflation data says.
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