Bitcoin Pulls Back Below $86,000 — Market Talk

2159 ET - Bitcoin pulls back in Asia's morning session, dropping below $86,000 but staying around its highest levels since January. A broad retreat in global bond yields improved the backdrop for risk assets, but the scope for further declines may be limited, says Konstantinos Chrysikos at Kudo.com. Coming inflation releases will be key as markets eye more interest-rate hikes. Softer readings could extend the recent pullback in yields, while firmer data could revive tightening expectations and cap Bitcoin's gains, Chrysikos says. Sustained ETF buying and a continued decline in oil prices could extend Bitcoin's advance, while any setback in Middle East diplomacy could quickly revive selling pressure. Bitcoin falls 1.6% to $85,561. ([email protected])2142 ET - The Indonesian rupiah's stability could give Bank Indonesia room to keep its policy rate unchanged in September, CIMB economists Joel Cheung and Michelle Chia say in a note. However, external pressures and rising inflation risks are likely to keep the central bank cautious. A weaker current account position and expectations for higher U.S. interest rates could put further pressure on the rupiah, they say. Higher crude prices, El Nino related supply disruptions, wildfires and volcanic ash are also expected to push inflation higher, they reckon. CIMB expects 2026 and 2027 inflation to be at 3.5% and 3.2%, respectively, and forecasts one 25bp rate increase in 4Q. ([email protected])2128 ET - Singapore's consumer-price index likely rose 2.3% on year in August, up slightly from July's 2.2%, according to the median estimate of seven economists polled by The Wall Street Journal. Core CPI, which excludes private road transport and accommodation, likely rose 2.2% in August, gaining pace from July's 2.0% increase, according to six of the polled economists. The readings likely reflect the continued lagged impact of higher global energy prices, including elevated electricity and gas price increases for the second straight month, DBS economists say in a report. The data are due Wednesday.([email protected])2115 ET - Weather-related palm oil and mining disruptions, coupled with higher oil prices, could slow Indonesia's external balance recovery, CIMB economists Joel Cheung and Michelle Chia say in a note. Palm oil output could remain under pressure from dry weather and wildfires, while low water levels could disrupt coal transportation and nickel production in near term, they reckon. Higher oil prices are also expected to widen the deficit by raising import costs, they say. They expect the current account deficit to narrow from its 2Q peak of 3.3% of GDP, but see weather disruptions and oil prices as key risks. They raise their 2026 current account deficit forecast to 2.0% of GDP, up from 1.6% expected earlier. ([email protected])2028 ET - The Reserve Bank of Australia's Chief Economist, Sarah Hunter, has reiterated the central bank's warnings about inflation in a podcast interview. "We think that the risk to inflation is skewed to the upside," she says, adding that if that risk does manifest, then the RBA board has been clear that it will definitely consider whether or not to hike the cash rate. The comments come after weeks of posturing by RBA officials that has led markets to expect two more interest rate increases before the end of the year. ([email protected]; X @JamesGlynnWSJ)2027 ET - Asian currencies are mixed against the dollar, but could strengthen on hopes for a resumption of U.S.-Iran negotiations that could underpin appetite for risky assets. President Trump signaled an openness to meeting Iranian officials heading to New York for a gathering of the United Nations General Assembly. Investors are closely watching Trump's address to world leaders for any market-moving signals on the Iran and Ukraine-Russia conflicts, Commerzbank Research analysts say in a note. The dollar is little changed at 157.35 yen but 0.4% lower at 1368.60 won, while the Australian dollar is 0.1% higher at US$0.7120, LSEG data show. ([email protected])1913 ET - CBA now estimates that global oil markets have 5 to 10 weeks before oil and refined product inventories deplete. That compares with estimates of closer to 15 to 20 weeks just two weeks ago. Inventory depletion raises the risk that Brent oil futures rise to $US150 per barrel, it adds. The leverage that Iran and their proxies have exerted via their control of key straits and their attack on Saudi Arabia's pipeline infrastructure has caused oil and refined product prices to surge and condensed the timeline for inventory depletion, says Vivek Dhar, economist at CBA. Dhar is now more confident that the U.S. will seek to make a deal with Iran. ([email protected]; @JamesGlynnWSJ)1858 ET - Shopify plans to allow Meta's buzzy personal AI agent Muse to complete purchases on behalf of users with Shop Pay, its accelerated, one-tap checkout service. Deutsche Bank analysts say the companies' collaboration is further proof that leading AI platforms are integrating with Shopify's commerce infrastructure. "We believe the partnership helps refute the recent bear thesis that AI agents and personal shoppers could disintermediate Shopify and its large payments business," they say. The partnership shows the value of Shopify's structured product data, merchant connectivity, checkout and the underlying infrastructure required to complete an order, they say. Shares of Shopify close up 7.3%, at $137.92, on Monday. ([email protected])1555 ET - Treasury yields start the week little changed after a volatile stretch, despite a sharp drop in oil prices. WTI crude falls 4%, to $96 a barrel. The WSJ Dollar Index, meanwhile, rises 0.1% as the greenback strengthens 0.3% against the yen and 0.2% versus the euro. Markets keep pricing at least one interest rate hike by the Fed in the next two meetings of 2026, since last week's hike and hawkish communication. The Fed seems to regain markets' confidence, as long-term yields fall. The 30-year drops 0.031 percentage point to 5.296%, while the 10-year sheds 0.033 point to 4.962%. The two-year rises 0.009 point to 4.751%. ([email protected]; @ptrevisani)1423 ET - The recovery in Canada's home resale market looks to be losing steam and activity remains low by historical standards, National Bank's Daren King and Evelyne Gosselin say. Sales fell 0.7% on-month in August, snapping a five-month streak of increases. King and Gosselin say a major headwind looms. Canadian and U.S. bond yields have surged since the start of the Iran war, yet mortgage rates haven't fully kept pace which has significantly squeezed lenders' margins. A rise in fixed-rate mortgage rates is therefore highly likely in the coming weeks, the pair argue. And sooner or later rising financing costs will weigh on affordability and undermine an already precarious recovery, unless geopolitical or trade tensions ease, they say. ([email protected]; @RobbMStewart)1423 ET - Bitcoin could extend its latest rally to $90,000 if long-term investors can join the buying streak, Nansen analyst Nicolai Sondergaard says in a note. The latest run-up was driven by a combination of renewed ETF demand and a big short squeeze, not a macro-driven accumulation event, the analyst says. The biggest traders on Hyperliquid are still net short, and more bitcoin is moving into exchanges than out of them, showing that crypto-native holders haven't embraced the rally, he says. Until they do, the run-up is vulnerable to a reversal if the ETF inflows weaken or Treasury yields push higher again, he says. Bitcoin is trading around $85,800, up 5.8% from a day earlier, according to CoinGlass. ([email protected])1240 ET - Bank of Canada Gov. Tiff Macklem stands ready to raise rates to contain inflation but that's not necessarily a foregone conclusion, says Royce Mendes, head of macro strategy at Desjardins Capital Markets. Mendes' reasoning comes after parsing through remarks from Macklem in Atlantic Canada, where he described the competing forces policymakers are grappling with — namely, elevated trade uncertainty and upward inflation risks. Mendes says that the BOC could raise rates as early as late October, so long as crude-oil prices remain over $100 a barrel and the CPI report for September shows a broadening of inflationary pressure. ([email protected]; @paulvieira)