The latest US inflation report for March, due Friday, is considered a vital indicator by several observers, given the context of the war in Iran and its inflationary impact.
However, the latest Bitcoin activity The market shows that traders do not view it as a major market driver.
“The Bitcoin market is currently only pricing in a 2.5% swing in either direction based on inflation data,” Markus Thielen, founder of 10x Research, told CoinDesk in an email. These probabilities come from options and derivatives prices, which reflect traders’ expectations of how much Bitcoin might move over a given period of time.
A 2.5% change matches well with bitcoin’s recent average volatility, indicating that the market is not expecting major directional moves from inflation data.
The market calm is also evident in the widely followed 30-day implied volatility represented by the BVIV index, which fell to 46.5%, the lowest since Jan. 31, according to data source TradingView.
This translates to an expected daily change of around 2.9%, which is 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 of price movements over a specific time period.
The data clearly shows that traders largely view Friday’s Consumer Price Index (CPI) release as a non-event. This is somewhat strange, given that the data is likely to provide insight into the inflationary impact of the war in Iran, which began in late February.
“Although the US price figures for March are unlikely to reflect the full extent of the situation, they nevertheless provide a first indication of the extent to which the conflict in the Middle East could be felt on US prices,” Commerzbank said.
It is worth noting that interest rate markets have largely lowered their expectations for a Fed rate cut this year as the war in Iran and the resulting energy price shock have increased inflation risks.
CPI expected Friday
The CPI data, scheduled for release Friday at 8:30 a.m. ET, is expected to show that the cost of living rose 3.4% year over year in March, a sharp increase from February’s 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 March’s 2.5% rise.
The expected sharp rise is largely due to soaring fuel and energy prices triggered by the war in Iran and soaring oil prices. Gasoline prices in the United States jumped in March 2026, exceeding $4 per gallon nationally for the first time since August 2022.
Several experts believe that macroeconomic conditions, particularly inflation data, are the main market drivers.
“As the energy shock continues to ripple through prices, each inflation number carries asymmetric weight for crypto: a softer reading reopens the rate-cutting conversation; a hotter reading further hardens the narrative of a longer hike,” 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 Bitcoin’s next move depends on Friday’s inflation data and the Fed meeting on April 28-29.
“These two events will indicate to the market whether policymakers still believe inflation is manageable after the oil shock, or whether the war prolongs the no-asset-cut regime,” Misir said in an email.
Long story short: There is a wide gap between experts’ expectations and how traders assess Friday’s inflation data. Whether markets are right to shrug or the data proves crucial, Friday will finally show which side is right.
