This article is reprinted with permission from Phyrex_Ni, and the copyright belongs to the original author.
This week's focus is undoubtedly on the non-farm payroll data to be released on Friday. It can even be said that the decision on whether to cut interest rates in September will hinge significantly on this meeting. However, the data this time will be quite complicated; it cannot simply be assumed that a rate cut is a positive signal and no cut is a negative one. The impact of the current U.S. economic environment on risk markets must be considered.
First, let's talk about non-farm payrolls. The current forecast for labor data is an increase from 73,000 last month to 75,000. Although this is an increase, the magnitude is not large, and the newly appointed Antoni is still waiting for Senate confirmation. Therefore, it is uncertain whether last month's data will be revised and by how much. If last month's data is revised downward, it would indicate that the current economic situation is indeed declining, and the job market window is closing.
If there is no downward revision, and the reported figure is 75,000, then the increase in employment would only be 2,000 people. Although this is an increase, the small number could still raise concerns about economic decline. Moreover, the unemployment rate is even more critical; last month's rate was 4.2%, which has already been rising. Although it is still relatively low historically, Powell mentioned at the Jackson Hole annual meeting that the unemployment rate has risen by nearly one percentage point over the past year. This indicates that the U.S. economy indeed faces downward risks, which is also the reason for the decline in risk markets over the past two weeks.
Additionally, a 4.3% unemployment rate is already considered the neutral value for the Federal Reserve in 2025. If it continues to rise, it could prompt the Fed to issue warnings about employment data. A downward expectation for employment could increase the likelihood of the Fed cutting rates in 2025, but such a cut may not necessarily be good for the market, as the economic situation is not optimistic, and a rate cut might just be a case of closing the barn door after the horse has bolted.
As of now, following last Friday's core PCE data, although the PCE value has risen, expectations for a rate cut in September have also increased. However, risk markets are declining, indicating that the current market expectation is that economic decline will trigger a Fed rate cut. In other words, expectations of stagflation are becoming stronger, leading some investors to believe that a rate cut may not be a positive development.
Of course, the best-case scenario would be for the non-farm employment data to exceed expectations, with no significant downward revision to the previous value, and for the unemployment rate to remain at 4.2% or even decrease slightly, which would be a positive expectation for the economy. However, this would not be good news for a rate cut. We discussed this topic last week; for the Fed's conservatives, whether inflation is transitory, whether the economy is entering a downturn, and whether the inflation trajectory can reach 2% are all major considerations for the Fed.
Especially since all tariffs have just begun to be implemented, the September data will not reflect the true situation post-tariff. If I were Powell, my choice would likely be not to cut rates in September but to wait for more data. October might be better, as it would provide a complete view of September's inflation. As long as the economy has not entered or is not expected to enter a downturn, a rate cut in October would be more prudent.
Unfortunately, the decision to cut rates is no longer solely up to the Fed. It is no longer just a reaction to inflation and the economy. Last week, we discussed why Trump urgently needs the Fed to cut rates. Up to now, Trump has even resorted to "intimidation" tactics. From the recent Cook incident, it seems likely that Trump has found a "loophole" with Cook that genuinely exists, but whether this justifies Cook's dismissal will depend on the court's ruling.
For Trump, we have repeatedly emphasized that data is ineffective in front of him. His goal is to lower interest rates to alleviate fiscal, economic, and political issues. Even after last week's core PCE data was released, he still believes that inflation is low enough. Currently, U.S. interest rates only need to be 1% to be sufficient, so he will use all means to expedite a Fed rate cut.
Therefore, from the Fed's perspective, the decision on whether to cut rates in September still involves a game of chance. Not cutting rates would indicate that the economy still has some resilience, while a rate cut could signal that signs of a downward trend have already appeared. Thus, aside from rate cuts, there is also the dot plot. There could be three rate cuts in total by 2025, which should be the result of Trump's efforts. If it remains at two or even lower, the market may face some dilemmas.
Moreover, what may trouble Trump is not only the Fed but also the fact that he has not fully achieved victory in the tariff war he initiated, especially domestically. On August 29, 2025, the U.S. Court of Appeals ruled 7 to 4 that the tariffs imposed by the Trump administration under the IEEPA exceeded the president's statutory authority and were illegal. Although most countries have completed tariff negotiations, for Trump, tariffs are an important new source of fiscal revenue and an effort to bring manufacturing back and increase labor.
Additionally, the biggest event Trump has undertaken since taking office, which has consumed over half a year of manpower and resources, would have a significant impact on his influence if deemed invalid and canceled. It would also create strong uncertainty in the market. Therefore, after the U.S. stock market officially opened on Tuesday, a downward trend was observed, with many economists explaining that this was partly due to concerns about Trump's health and partly due to worries about the tariff situation. This could also inadvertently affect cryptocurrencies that rely on Trump's benefits, but the situation is not entirely without hope.
Although the ruling deemed the tariffs illegal, the court allowed these tariffs to remain in effect until around October 15, 2025, to give the Trump administration time to appeal to the U.S. Supreme Court. The ruling primarily targeted the "baseline" and "reciprocal" tariffs imposed under the IEEPA, while tariffs established under the Trade Expansion Act of 1962, particularly those related to steel and aluminum, remain effective and unaffected by this ruling. Therefore, Trump still has some opportunities for reversal. Of course, before that, Trump appeared on a live broadcast from the White House at 2:30 AM on Wednesday and responded to questions about his health. During the live broadcast, the U.S. market's decline gradually rebounded.
Returning to tariffs, Trump's main opportunity now is to appeal to the U.S. Supreme Court. Yesterday, Treasury Secretary Mnuchin expressed confidence that the Supreme Court would support the president's use of IEEPA powers in national emergencies, especially in addressing urgent issues like trade imbalances and the fentanyl crisis. Trump's team is also actively preparing responses to the tariff ruling and stated that an emergency meeting would be convened on Wednesday to formulate measures.
However, if the Supreme Court does not support the IEEPA, the government could consider Section 338 of the Smoot-Hawley Tariff Act of 1930 as an alternative measure. It could also potentially re-establish or maintain certain tariffs based on different legal grounds, such as Section 301 or Section 201 of the Trade Act of 1974, or Section 232 of the Trade Expansion Act of 1962, particularly targeting specific products (like steel and aluminum). Of course, this approach would be more complex and could lead Trump's team into a new round of tariff disputes, and the countries affected by the tariffs may not sit idly by.
Additionally, Congress could legislate to grant the president explicit powers or request temporary authorization to legalize such tariffs. The "2025 Trade Review Act" is an example; if passed, it would require the president to notify Congress of new tariffs within 48 hours and obtain congressional approval within 60 days. This is indeed a feasible solution, but currently, there are already troublesome negotiations within the Republican Party, let alone with the Democrats. Therefore, returning to legislative action in Congress is quite challenging.
Thus, for Trump, the most straightforward way is still to obtain approval from the Supreme Court. Whether the Supreme Court will approve Trump's tariffs is currently an unresolved game. The Trump administration has already applied for expedited appeal, and Treasury Secretary Mnuchin even publicly stated that the Supreme Court will definitely side with the president because this involves urgent issues of national security and the fentanyl crisis. However, from a legal standpoint, whether the president can unilaterally impose large-scale tariffs under the IEEPA has no precedent. The Supreme Court may classify this under the "major questions doctrine," requiring clear congressional authorization, which means the ruling carries significant uncertainty.
Therefore, although Trump can choose other options, whether he can gain the Supreme Court's support still hinges on the legitimacy of the tariffs. If he cannot obtain support, even if there are other routes to pursue, it will inevitably increase market uncertainty and lead to a decline in Trump's approval ratings and trust levels. Additionally, he would have to refund the tariffs already collected, which, although there are no precise statistics, is estimated to be between $50 billion and $200 billion. If refunds are necessary, it would also be a heavy blow to U.S. finances.
The final macro issue should be the case regarding the dismissal of Fed's Cook. On August 29, a hearing was held in the U.S. District Court for the District of Columbia, where the federal judge did not make a ruling on the spot but requested Cook's lawyer to submit supplementary explanations by Tuesday, detailing why these allegations do not constitute "just cause" for dismissal. During this period, Cook still retains all his powers as a Fed governor and is still appearing on the Fed's official website, having not been formally removed.
As of now, the Fed's board has not publicly supported either side in the case, emphasizing that it only expects a swift ruling from the court to eliminate uncertainty. The Department of Justice supports the president's discretion in determining "just cause." By Tuesday evening, the director of the Federal Housing Finance Agency, Furlong, publicly stated that he had received video evidence showing that Cook's declared primary residence is being rented out. This is very unfavorable for Cook.
However, as I mentioned last week, although Cook's actions are controversial, the controversy has already expanded to broader political and institutional levels. If Trump successfully removes Cook and nominates another supporter to fill the vacancy on the Fed's board, it would directly threaten the Fed's independence. Mainstream media and scholars generally warn that this is a significant intervention in the Fed's institutional independence and could have long-term consequences. The legal community points out that the Supreme Court has previously established protective zones for the Fed, and the final outcome of this case remains highly uncertain, potentially ultimately decided by the Supreme Court.
While scholars are concerned about the Fed's independence, the market shows a completely different attitude. After all, high interest rates are not something the market wants to accept, especially when the economy may enter a recession. A quick reduction in interest rates is also something the market is eager to see. Therefore, regarding Trump's dismissal of Cook, the market's aversion is not strong. If it allows Trump to control more Fed governors and smoothly enter a rate-cutting cycle, it would be a good thing for the market. As for the Fed's independence and inflation issues, it is likely that these are not what the market is currently concerned about.
Having discussed the macro aspects, let's return to the on-chain data. First, regarding the exchange reserves, the trend of this data this week is quite intriguing. Although the overall exchange reserves appear to be decreasing, with an increase in the amount of BTC being withdrawn from exchanges, if we look at the detailed data, we can find that the BTC reserves in three major exchanges—Binance, OKX, and Coinbase—have not decreased significantly.
In fact, the BTC reserves in Binance and OKX have not only not decreased but have actually increased during the week. We discussed this issue last week; since the whale sell-off last month, the reserves in these two exchanges have been continuously rising. Although Coinbase also saw a decrease in reserves during the week, it was not as pronounced. This decrease in reserves mainly came from Kraken, which reduced its BTC reserves by over 65,000 in a short period.
However, from Kraken's trading volume, there has not been a significant upward trend this week, and the gap compared to other exchanges is not large. Therefore, the changes in this part of the reserves should be viewed more cautiously; it does not necessarily indicate investor buying. In fact, excluding the 60,000 BTC, the reserves of BTC on exchanges this week have remained almost balanced, showing no significant changes. This data is more aligned with the current fluctuations in Bitcoin prices, indicating that there have not been any substantial large-scale buys or sells.
Additionally, in the past week’s ETF data, Bitcoin not only showed no improvement but also fell into a trough in both primary and secondary markets. In the primary market, there were multiple instances of net outflows over the past week, and even when there was a small inflow, the amount was not high. Compared to the end of 2024 and early 2025, and even compared to the last quarter, the buying volume in the primary market has plummeted, which has become a reason constraining the rise in BTC prices.
Next, the $IBIT, which represents the trading volume of the spot ETF in the secondary market, has also shown a gradual decline over the past week. The turnover and purchasing sentiment among traditional investors are not strong, which is the biggest gap between BTC and ETH currently.
From the $ETH data, it is evident that the net inflow in the primary market over the past week has significantly exceeded that of BTC. Although there has been a decrease in the secondary market's $ETHA, it has temporarily maintained a relatively high moving average level over the past month. This indicates that traditional investors currently favor ETH more than BTC, which is also a reason for ETH's price stability.
However, the data on ETH's spot trading volume does not look very optimistic. Both Binance and Coinbase have shown a downward trend in trading volume. Combined with the ETF data, it seems that traditional investors are buying ETH more, while the purchasing power of cryptocurrency investors in the ETH spot market has weakened.
Additionally, it is worth noting that in the same week, there has been a noticeable upward trend in $SOL's trading volume from CME futures to spot transactions on exchanges. Considering that there have been recent discussions about SOL's strategic reserves, it is possible that investors are preparing to ambush a third large strategic reserve, similar to BTC and ETH. The outcome is uncertain, but there are indeed signs of a trend. Of course, the current price changes are still dominated by monetary policy and the game with Trump.
Next, we look at the data for BTC held for a year, which has not shown any significant errors in this cycle. This data decisively indicates that long-term holders are continuing to distribute. If the data remains accurate, there is still a possibility for BTC prices to rise. Each weekly report should reiterate that data has a lagging nature, and the main game currently stems from the interplay between Trump, monetary policy, and tariffs. The outcomes of these two factors could change the direction of the data at any time.
In the past two weeks, there has also been considerable attention on the data for open contracts, which can reveal the current game situation among investors. First, for BTC's open contracts, although BTC prices have primarily declined over the past two weeks, there has not been a significant weakening trend in open contracts; instead, they have been oscillating upward. This indicates that the long-short game is increasing, and investors have begun to increase their leverage on BTC, which may lead to greater price volatility for BTC. This is not a very optimistic data point.
Similarly, for ETH's open contracts, although they are at historically high levels, the volume of open contracts has also decreased in the past two weeks as ETH prices have fallen. This indicates that leveraged funds in ETH are gradually weakening. However, since the level is already high, the weakening is still ongoing. Currently, ETH's leverage remains high, but if it continues to decline, it will be beneficial for ETH's growth.
Then, regarding the data for BTC held over the past week, this data was already interesting last week, showing a slight increase in holdings for high-net-worth investors holding more than 10 BTC, while the increase in holdings for small-scale investors holding less than 10 BTC was even larger. This week is similar, with high-net-worth investors showing a more noticeable increase in holdings compared to last week, while the number of small-scale investors' holdings is also rising. It feels like everyone is holding BTC, with selling volumes still trending low.
Finally, we still look at the URPD data. Previously, we inferred that $110,000 should be a good support point, and the support capacity between $111,000 and $112,000 is still decent. A week later, although BTC's price remains oscillating, the stability at $110,000 is still quite high. The firmness of the fifth and sixth support levels does not need to be worried about unless new negative data emerges. Unless there is a systemic risk, these two positions remain quite stable. Moreover, after oscillating for so long, there are no significant signs of panic among investors around the $115,000 mark, which aligns with the current profile of BTC investors. Their expectations for the future mean that this group of investors is not in a hurry to sell.
In summary, although there have been some market fluctuations this week regarding tariffs and Trump's health, the main game still revolves around Trump and the Federal Reserve's monetary policy. Tariffs can at least wait until mid-October, allowing for some time to avoid immediate concerns. Worries about Trump's health are not likely to escalate in the short term, but there is less than two weeks left for monetary policy. The series of games evolving from monetary policy is the current market focus. September not only has a policy meeting but also the dot plot, and the labor data within the week is likely to be key in determining whether there will be a rate cut in September and the dot plot. Under the dual pressure of the economy and inflation, the market will also be very conflicted.
Related: The Federal Reserve prepares for a DeFi and payment innovation conference, with tokenized RWA facing an important week.
Original: “Non-farm Payrolls and Monetary Policy Game: Trump, Tariffs, and the Fed's September Test”
免责声明：本文章仅代表作者个人观点，不代表本平台的立场和观点。本文章仅供信息分享，不构成对任何人的任何投资建议。用户与作者之间的任何争议，与本平台无关。如网页中刊载的文章或图片涉及侵权，请提供相关的权利证明和身份证明发送邮件到support@aicoin.com，本平台相关工作人员将会进行核查。
