BTC Retakes $112K, SOL Marks 7-Month High While Economists Downplay Economic Slowdown Fears

Cryptos Surge as Economists Dismiss Recession and Stagflation Fears
10/9/2025

Major cryptocurrencies and European equities climbed Wednesday as analysts downplayed concerns over a U.S. recession and stagflation following revised jobs data.

Bitcoin (BTC) reclaimed $112,000, trading near $113,745, while European stocks opened higher, reflecting broad market optimism. The gains came after the U.S. Bureau of Labor Statistics (BLS) revised the economy’s job growth downward by 911,000 for the 12 months through March 2025.

Investors had relied on a strong labor market to sustain growth despite persistent inflation. Tuesday’s revision briefly shook confidence, pushing BTC from $113,000 to $110,800.

Some interpreted the revision as a recession warning. Michael Englund, chief economist at Action Economics, said the data mainly reflects long-term trends in the U.S. labor force rather than immediate economic risks.

“Trend-growth for monthly payrolls is now likely in the tens of thousands rather than the hundreds of thousands seen in prior expansions,” Englund said. “We now expect labor force growth of about 90,000 going forward.”

He added that the post-COVID labor surge, driven by roughly one million annual net migrants, has shifted to a net out-migration of one to two million, implying slower employment growth in the future.

Markets largely embraced this view. BTC climbed back above $112,000, while Ether (ETH), XRP, and Dogecoin (DOGE) erased most of Tuesday’s losses. Solana (SOL) surged to $222, its highest since February 1. S&P 500 futures rose 0.3%, with European equities opening higher.

Stagflation Fears Overstated

Despite inflation hovering near 3%, analysts argue stagflation risks remain overblown. Marc Chandler, chief market strategist at Bannockburn Global Forex, noted that U.S. GDP continues to exceed the Fed’s non-inflationary trend.

“Inflation is slightly elevated, but the Fed is focused on temporary factors, and easing appears likely,” Chandler said.

Traders are pricing a 91% probability of a 25-basis-point rate cut to 4% on Sept. 17, though some anticipate a larger 50-basis-point move.

CPI and PPI in Focus

Markets will watch Wednesday’s Producer Price Index (PPI) and Thursday’s Consumer Price Index (CPI). Signs of easing inflation could support risk assets, while stronger-than-expected readings may trigger volatility.

“If the market expects a 50-basis-point cut but only 25 are delivered, a sell-off is possible,” said Greg Magadini, director of derivatives at Amberdata.