Federal Reserve Governor Christopher Waller told a Reuters NEXT audience at 08:30 Washington time on Thursday that he would support leaving the federal funds rate where it is at the 15–16 September meeting, provided the inflation data due over the next two weeks keep improving. Six days after Chair Kevin Warsh’s Jackson Hole keynote had pushed the market toward a hike, it was a permanent voter laying out the case for not hiking, and the market treated it as news: the CME FedWatch probability of a hike fell from roughly 67% to 54.6% within minutes, per investingLive’s account of the tool’s history table, and The Motley Fool had it at 50.5% by the evening. The 2-year Treasury closed at 4.34%, five basis points lower. The S&P 500 rose 1.06% to 7,747.71, its best day in a month per Yahoo Finance and CNBC, the Dow added 624 points and the Nasdaq 1.4%.
Bitcoin, which had not moved more than 1.5% at any close in the previous three sessions, closed at $81,265.00 on Bitstamp, up 5.127% from Wednesday’s $77,301.83. That is the first daily close above $81,000 since 14 May ($81,075) and the highest close since 11 May ($81,736), on our Bitstamp series; the day’s high of $82,280.62 was also the highest print since 11 May. Of the 246 daily changes recorded so far in 2026, Thursday’s was the eighth-largest gain and the largest since 21 August (+7.283%). As of 06:10 UTC on Friday the price was $81,063.55 on Binance, 0.248% below the close, with the August payrolls report due at 08:30 ET and the FOMC decision twelve days away.
What Waller actually said, in his own words
The speech text runs nine pages and the policy paragraph is short enough to quote rather than paraphrase. “We will get another employment report and inflation reading before the next FOMC meeting. I don’t expect that the employment data will deviate much from what we have been seeing. So my decision on the appropriate stance of policy will be heavily influenced by what we learn about August inflation. If there is continued progress toward our 2 percent goal, then I am willing to support holding the policy rate at its current level.” The next sentence is the one that most of Thursday’s headlines dropped: “But if inflation comes in hot, I would consider a rate hike. I judge that policy is currently only slightly restricting aggregate demand, and it may not take much acceleration in inflation to nudge me into supporting tighter policy.”
The inflation case he laid out is specific. Twelve-month PCE is 3.7% and core PCE 3.3%, which he called “not the best guide for where inflation is today.” Three-month annualised core PCE is 3.05% through July, down from 4.76% in February — “a considerable improvement, and the speed of this downward trajectory is encouraging.” He said roughly half of July’s core increase came from imputed nonmarket services prices, which he has long discounted, and that a pending Commerce Department change to how it estimates financial-service fees “could lower 12-month PCE inflation by a few tenths of a percentage point.” On jobs, he expects “more of the same” from this morning’s report, after an average of 60,000 a month through July and a 4.1% unemployment rate. The data he named as decisive is the August CPI, which the BLS publishes on Friday 11 September at 08:30 ET, per the release schedule. Payrolls, in his framing, is the report he expects not to matter.
The 2-year moved 5bp. That is more than an average payrolls day, and it is not rare.
The 2-year Treasury constant-maturity yield closed at 4.34% on Thursday against 4.39% on Wednesday, per the Treasury’s daily file. Yesterday’s field guide scored 2026’s data days on exactly this series: payrolls days have moved the 2-year 4.6bp on average, ADP days 2.1bp, and the ordinary session 3.7bp. So a single governor’s speech moved the front end by more than the average payrolls print. We should be honest about the second half of that sentence: a 5bp day is common. Of the 169 daily changes in the 2026 file, 64 — 38% — were 5bp or larger in either direction, and the 2-year has risen 87bp this year, from 3.47% on 2 January. What is unusual about Thursday is the direction and the cause, not the size. It was the largest one-day fall in the 2-year since 25 August (−7bp), and it came on a day with no data surprise in the dovish direction: jobless claims were 206,000 against a 205,000 consensus, and the ISM services index rose to 55.4 from 54.1, a beat.
| Tenor | 2 Sep close | 3 Sep close | Change |
|---|---|---|---|
| 3-month bill | 3.92 | 3.89 | −3bp |
| 2-year | 4.39 | 4.34 | −5bp |
| 5-year | 4.54 | 4.52 | −2bp |
| 10-year | 4.79 | 4.77 | −2bp |
| 30-year | 5.27 | 5.25 | −2bp |
| 10-year real (TIPS) | 2.45 | 2.42 | −3bp |
| 10-year breakeven | 2.34 | 2.35 | +1bp |
US Treasury daily par yield curve and daily real yield curve, 2026 files, pulled 4 September 2026, 06:10 UTC. Breakeven is nominal minus real, computed here.
Two features of the table matter for bitcoin specifically. The move was front-loaded — 5bp at two years, 2bp at ten and thirty — which is the shape of a repricing of the next meeting rather than of the long-run path. And the 10-year’s 2bp fall was entirely real rate (−3bp) with the breakeven a basis point higher, which by Wednesday’s split is the half that lowers the opportunity cost of a zero-yield asset. The 30-year’s 5.25% close sits exactly on the bar of our H3 marker (≥ 5.25% on 17 September), passing by zero basis points; the 10-year real at 2.42% is now 8bp from the I1 bar rather than 5bp.
Not only Waller: the same session had $730.8 million of ETF inflow, a yen surge and a strong services print
The attribution problem with Thursday is that several things happened at once, and the checklist says to list them before crediting any one. The US spot bitcoin ETFs took in $730.8 million on Thursday, per Farside Investors’ table — IBIT $454.0 million, ARKB $137.7 million, FBTC $74.4 million, Grayscale’s mini BTC $48.8 million, BITB $24.8 million, GBTC $8.2 million and MSBT $7.7 million against redemptions of $19.6 million from HODL and $5.2 million from BTCW. That is the largest session of the fourteen visible on the table, ahead of 20 August’s $606.3 million, and it turns September’s running total from −$135.4 million to +$595.4 million after three sessions. ARKB’s $137.7 million is that fund’s largest day in the same fourteen rows; GBTC’s $8.2 million is its first inflow since 19 August. ETF creations are executed during the US session and reported after the close, so the flow and the price move were simultaneous rather than one causing the other; what the number says is that the buying on Thursday had a cash leg, which was not true of most of August.
Two other things moved. The yen jumped more than 1% to 156.15 per dollar, its strongest since 3 August, per CNBC, on hawkish Bank of Japan comments ahead of the 18 September decision and speculation about a rate check; Schwab’s morning note credited the yen with part of the fall in US yields. And the ISM services PMI for August came in at 55.4, up 1.3 points and the 26th straight month of expansion, per the ISM release — a growth beat that, on any other day, is the kind of number that raises hike odds rather than lowers them. That the front end fell anyway is the clearest evidence that Waller, not the data, was the day’s driver.
What the rally was made of
Bitcoin’s 5.127% was almost five times the S&P’s 1.06%, which is roughly the ratio the two have kept on rate-repricing days this summer. Two of our own series say the move had both cash and leverage behind it. The ETF column above is the cash. On the derivatives side, Binance’s perpetual open interest rose from 107,652 to 112,718 BTC between Thursday’s and Friday’s 00:00 UTC snapshots — 5,065 coins of new contracts, +4.705%, the largest one-day addition in the ten snapshots we hold — while the dollar figure rose 10.031% to $9.157 billion, an identity that closes exactly (1.04705 × 1.05086 = 1.10031). Funding at the 00:00 settlement was 0.008558% per eight hours, 9.371% annualised. The September quarterly, by contrast, went the other way: its annualised basis fell to 2.849% from 4.306% a day earlier, so the leverage that arrived was in the perpetual, not the dated contract. The full decomposition is in today’s markers piece.
Strategy’s stock rose 17.56% to $144.82, per S&P Global data via StockAnalysis, on 43.9 million shares — 3.4 times bitcoin’s move. The 4,603-coin tranche the company disclosed on Monday at an average of $80,318, which we reported was underwater from the moment it was filed, finished Thursday $4.36 million in profit. That marker, H1, is settled; the update has the arithmetic.
What has to hold, and the marker
Waller’s position is conditional on a print that has not happened, and he said so twice. The path from here runs through three dates: payrolls this morning at 08:30 ET (Dow Jones consensus +53,000 and 4.1% unemployment, per CNBC), which he has pre-announced he expects to be uninformative; the August CPI on Friday 11 September, which he named as decisive; and the decision on Wednesday 16 September. A hot CPI reverses Thursday in full, on his own account. It is also worth keeping in view that a “hold” here means not hiking from a 3.50–3.75% range that the Committee has already declined to cut, and that the Chair, on 28 August, used the word “hike” three times. One governor’s reaction function is a data point about the Committee, not a decision by it.
As standing practice we mark one falsifiable claim on this. L1: bitcoin’s Bitstamp daily close on Wednesday 16 September 2026 — FOMC decision day — is at or above $81,265.00, Thursday’s close. If the Waller repricing survives payrolls, CPI and the decision itself, the level should hold; if any of the three reverses it, the close on the 16th will say so. We have no view on which, and the marker is set where the answer is unknown. Yesterday’s marker J1 — that the 2-year moves at least 5bp on today’s payrolls close — grades on tonight’s Treasury file; Thursday’s 5bp, note, does not count, because it came a day early and from a speech.
Method: prices, funding, open interest, basis and on-chain figures in this article are pulled directly by Bitcoin Mastery at the timestamp stated — Bitstamp BTC/USD daily candles for closes, Binance BTCUSDT spot and USDT-margined perpetual for intraday, open interest, funding and account ratios, Binance COIN-M quarterly contracts for basis, mempool.space for difficulty and hashrate, alternative.me for the Fear & Greed series, Farside Investors’ table for ETF flows (every named fund column is read from a print of that column with its header) and US Treasury CMT par yields, nominal and real, for rates. Where a third-party figure is cited we name the source and its date; where two sources disagree we print both. Every streak or extreme figure is published with the first date of its series in the same sentence.
Disclaimer: This article is for informational purposes only and does not constitute investment advice. Cryptocurrencies are volatile and you can lose money. Nothing here is a recommendation to buy or sell any security, digital asset or exchange-traded fund, including MSTR. Do your own research and consult a licensed financial advisor before making investment decisions.