The latest US inflation report for March, due out on Friday, is seen by several observers as a vital indicator, given the backdrop of the Iran war and its inflationary impact.
However, the latest activity in bitcoin The market shows that traders do not see it as an important factor in the market.
“The bitcoin market is currently pricing in a swing of just 2.5% in either direction due to inflation data,” Markus Thielen, founder of 10x Research, told CoinDesk in an email. These probabilities are derived from options and derivatives prices, which reflect traders’ expectations about how much Bitcoin could move in a given time period.
A 2.5% swing is within bitcoin’s recent average volatility, indicating that the market is not expecting any major directional moves from the inflation data.
Market calm is also evident in 30-day implied volatility, represented by the BVIV index, which has fallen to 46.5%, the lowest level since January 31, according to data source TradingView.
This translates to an expected daily move of around 2.9%, well below the 30-day average of 3.4%. Implied volatility is determined by the demand for options or hedging bets and represents traders’ expectations about price swings over a specific period.
The data clearly shows that traders are largely treating Friday’s consumer price index (CPI) release as a non-event. This is somewhat strange, given that the data is likely to offer insight into the inflationary impact of the Iran war, which began in late February.
“While the US price figures for March are unlikely to reflect the full magnitude of the situation, they do provide an initial indication of how strongly the Middle East conflict could be felt on US prices,” Commerzbank said.
It is worth noting that interest rate markets have greatly reduced expectations of rate cuts by the Federal Reserve this year, as the Iran war and the resulting energy price shock have increased inflation risks.
CPI expected for Friday
CPI data, scheduled for release Friday at 8:30 ET, is expected to show that the cost of living rose 3.4% year-over-year in March, a sharp increase from February’s reading of 2.4%, according to data source MarketWatch. The core figure, which excludes the volatile food and energy component, is expected to have risen 2.7% after a 2.5% increase in March.
The expected strong rebound is largely due to the increase in fuel and energy prices caused by the Iran war and the increase in the price of oil. Gasoline prices in the United States increased in March 2026, surpassing $4 per gallon nationally for the first time since August 2022.
Several experts believe that macroeconomic conditions, particularly inflation data, are the dominant market drivers.
“Since the energy shock is still transmitted to prices, each inflation data has an asymmetric weight for cryptocurrencies: a softer reading reopens the rate cut conversation; a hotter one further hardens the narrative of a hike for longer,” Nexo analyst Iliya Kalchev said in an email. Nexo is a digital asset wealth manager with $8 billion in assets under management.
Timothy Misir, head of research at BRN, said the next step for bitcoin depends on Friday’s inflation data and the Federal Reserve meeting on April 28-29.
“Those two developments will tell the market whether policymakers still think inflation is controllable after the oil shock, or whether the war is extending the no-cuts regime,” Misir said in an email.
Bottom line: There’s a wide gap between experts’ expectations and how traders are pricing Friday’s inflation data. Whether the markets are right to shrug their shoulders or the data proves crucial, Friday will finally show who is right.
