BTC Volatility Amid Fed Rate Hike Speculation and Inflation Data

QCP Capital's weekly market report: Following Fed Chair Warsh's speech at Jackson Hole, the probability of a September rate hike rose from 35% to 70%, causing BTC to fall approximately 2.5% in a single day; after nine consecutive days of net inflows, ETFs recorded a net outflow of $2.02 billion. However, the dollar failed to sustain its hawkish pricing, with the DXY falling below 99.5, allowing gold, silver, and BTC to recover their losses. On the fiscal front, the Treasury will initiate its first long-end liquidity support operation on September 9, raising the purchase cap to at least $4 billion (up from $2 billion). The auction yield for August 30-year Treasuries settled at 5.216%, the highest since 2001, and markets will closely monitor whether this operation effectively improves long-end liquidity. Regarding inflation, July’s PCE came in at 3.7% (core at 3.3%), while CPI stood at 3.4% (core at 2.5%). Brent crude rose approximately 10% for the week due to attacks on the Strait of Hormuz and force majeure events affecting Qatari LNG, sustaining inflationary pressures. Waller noted that if upcoming data over the next two weeks continue along current trends, it would support pausing rate hikes—combined with ADP employment data showing only 38,000 jobs added (the weakest since January), the probability of a September rate hike has now retreated to 45–50%.