BTC Surges to $112K, SOL Hits Highest Level in 7 Months as Economists Dismiss Recession Risks

Cryptos Rebound as Economists Downplay Recession and Stagflation Concerns
10/9/2025

Major cryptocurrencies and European equities climbed Wednesday as analysts dismissed fears of stagflation and recession triggered by a downward revision in U.S. jobs data.

Bitcoin (BTC) reclaimed $112,000, trading around $113,745, while European stocks opened higher, reflecting an upbeat market sentiment. The rise came after the U.S. Bureau of Labor Statistics (BLS) reported that the economy likely added 911,000 fewer jobs than initially reported over the 12 months through March 2025.

For months, market bulls in both crypto and equities had relied on a robust labor market to support economic growth despite persistent inflation. Tuesday’s revision briefly spooked markets, pushing BTC from $113,000 to $110,800.

Some investors interpreted the BLS revision as a warning of recession. However, Michael Englund, chief economist at Action Economics, said the data offered little insight into the current business cycle.

“These revisions mainly reflect the long-term trajectory of the U.S. labor force rather than near-term economic risks,” Englund said. “Trend-growth for monthly payrolls is now likely in the tens of thousands, down from the hundreds of thousands seen during most of the current expansion. We project labor force growth of about 90,000 going forward.”

Englund explained that the post-COVID labor force surge had been driven by roughly one million annual net migrants, a trend now reversing to a net out-migration of one to two million. This shift suggests slower growth in employment figures moving forward.

Markets have largely embraced this view. BTC recovered above $112,000, while Ether (ETH), XRP, and Dogecoin (DOGE) erased significant losses. Solana (SOL) jumped to $222, its highest level since February 1. S&P 500 futures rose 0.3%, and European equities opened higher.

Stagflation Fears Appear Overblown

Despite concerns about persistently high inflation, analysts argue that stagflation risks are exaggerated. Marc Chandler, chief market strategist at Bannockburn Global Forex, noted that U.S. GDP remains above the Federal Reserve’s non-inflationary trend estimate.

“While inflation is elevated, the Fed is likely to look past temporary tariff-related price increases,” Chandler said. “It seems clear the central bank will resume easing next week.”

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

Upcoming CPI and PPI Reports in Focus

Expectations of rate cuts could rise if the upcoming U.S. Producer Price Index (PPI) and Consumer Price Index (CPI) show signs of easing inflation, supporting risk assets in the short term. Analysts caution, however, that high expectations could trigger volatility.

“If the market anticipates a 50-basis-point cut but the Fed delivers only 25, a sell-off could follow,” said Greg Magadini, director of derivatives at Amberdata.