A downgraded inflation statistic and real expenditure over 18 months provide contradictory messages to the Federal Reserve.

Bitcoin is trading that way.

The biggest monthly gain in US consumer expenditure since March 2025 came in August, when inflation was adjusted up 0.6%. Despite expectations of a 3.7% annual increase, The Fed’s preferred inflation gauge – the PCE price index – only managed a 3.4% gain. In addition, the monthly increase came in at 0.3% instead of the predicted 0.4%. The Core PCE, came in at 3.0%, which is lower than the expected 3.3%.

Even when demand is high and prices are low, that doesn’t mean the Fed has finished its move.

They stand for a hybrid of a central bank with slowdown capabilities. For a little while,…