Bitcoin’s next Fed test comes with a hidden problem in America’s inflation data

Bitcoin faces another Federal Reserve interest-rate decision as the US struggles to restore the surveys underpinning its inflation figures.

The Bureau of Labor Statistics collected 66.3% of targeted price observations in its commodities-and-services survey in September, according to figures updated October 19. That was a modest improvement from 65.9% in August but remained below the 67.6% recorded a year earlier.

The shortfall comes as the agency rebuilds data-collection operations after staffing and survey reductions introduced in 2025, with restoration still incomplete ahead of the Federal Reserve's October 27–28 policy meeting.

The uncertainty adds another consideration to an already difficult inflation outlook after US consumer prices rose 3.7% annually in September, accelerating from 3.4% in August.

Bitcoin has already demonstrated its sensitivity to the inflation figures driving interest-rate expectations.

In its October 16 market commentary, Coinbase Institutional reported that Bitcoin fell from approximately $83,800 to below $82,000 in the hours following September's hotter-than-expected CPI release, which sent two-year Treasury yields sharply higher.

The latest BLS disclosure raises questions about the statistical information supporting those closely watched figures, although the agency has not identified a directional bias in its recent inflation estimates.

Inflation collection remains incomplete after 2025 cuts

The BLS began scaling back consumer price collection in several US locations in summer 2025, suspending operations in Lincoln, Nebraska; Provo, Utah; and Buffalo, New York.

The agency resumed recruitment, hiring, and training in November 2025 and said in an October 22 update that collection would gradually expand as additional field staff became operational.

The September figures show progress from June's 65% collection rate, although they remain below the 67.4% recorded in March.

Missing observations complicate CPI calculations because the government must account for prices researchers cannot obtain directly.

The BLS uses statistical techniques, including estimating missing prices from comparable products within the same category and geographic area. Those estimates can be less representative if unobserved prices behave differently from the prices collected.

However, the 33.7% noncollection rate does not mean the agency estimates a third of the CPI. The published figure covers an unweighted survey of targeted price quotes, excluding separate housing observations and other data sources.

The agency has also cautioned that lower response rates can increase the risk of statistical bias without demonstrating that published inflation is being systematically understated or overstated.

An August research paper examining data from 2018 through 2023 found limited differences in headline inflation measures under alternative estimation methods, although some detailed price categories showed potential discrepancies.

Those findings predate the 2025 collection cuts, leaving their effect on the latest inflation calculations unquantified.

Bitcoin's $80,000 support faces another interest-rate test

The collection challenges arrive as investors reassess the prospect of further Federal Reserve tightening following a series of stronger inflation readings.

In its October 23 market outlook, Coinbase Institutional said interest-rate futures implied nearly an 80% probability of a December rate increase after September producer prices surged 1.3%, their largest monthly advance since March 2022.

The firm identified the $80,000 to $82,000 range as a critical near-term support area for Bitcoin, where the estimated $81,300 average acquisition price of US spot Bitcoin ETF investors overlaps with the cryptocurrency's 50-day moving average.

That level has become increasingly important as Bitcoin faces pressure from elevated Treasury yields, which offer investors returns unavailable from simply holding the cryptocurrency.

Coinbase estimated that two-year Treasuries were yielding close to 4.8%, increasing the opportunity cost of holding non-yielding assets.

The firm's derivatives data also pointed to a market vulnerable to changing expectations. Bitcoin's one-month implied volatility stood near 35%, among its lowest historical readings, while perpetual futures funding rates climbed as leveraged traders rebuilt bullish positions.

A policy surprise could therefore test a market where traders have added leverage despite relatively subdued expectations for price swings.

Still, the BLS collection figures provide no evidence that September's CPI overstated or understated inflation, or that investors have changed their positions specifically because of the agency's restoration efforts.

The immediate question is how the Fed interprets the existing inflation evidence when it announces its October 28 decision, particularly after consumer and producer prices accelerated in September.