Crypto markets are off to a positive start in what in the past has been their strongest quarter of the year, with bitcoin (BTC) rising nearly 4% over the past 24 hours to $117,400.

Already higher overnight, crypto prices rose further early in the U.S. session as fresh economic data suggested September’s Federal Reserve rate cut won’t be nearly the last this year.

Private payrolls saw their largest decline in 2.5 years in September as companies in the private sector lost 32,000 jobs according to a fresh report from payroll processing firm ADP. August’s originally reported 54,000 gain was revised to a loss of 3,000 jobs.

Traders would typically be far more focused on the Labor Department’s monthly jobs report due Friday, but the release will likely be delayed due to the ongoing government shutdown.

Also on Wednesday, the ISM September Manufacturing PMI Survey was in line at 49.1, but the Prices Paid index showed some welcome inflation news, dropping to 61.9 from 63.7 in August and forecasts for 63.2.

In equities, both the Nasdaq and S&P 500 were down slightly. Gold, which hit a fresh all-time high of $3,921 earlier on Wednesday, edged back to $3,888.

A look at altcoins show gains across the board, with ether (ETH), Solana’s SOL (SOL) and dogecoin (DOGE) up 5%-7% over the past 24 hours, outpacing bitcoin’s advance.

Amid uncertainty over upcoming data releases to guide monetary policymakers about the economy, market participants nevertheless universally expect the Federal Reserve to lower benchmark interest rates further at the upcoming October meeting. The CME FedWatch Tool shows 99% probability of a 25 basis point cut, up from 92% one week ago.

October starts strong

September has typically been a treacherous month for crypto, but little-noticed in the poor investor sentiment of late was bitcoin having one of its best Septembers in many years, gaining about 6% for the month.

In the final two days of September, the spot bitcoin ETFs gathered $950 million of inflows, more than reversing the $900 million of outflows the previous week.

«The next quarter is likely to see the start of the crypto bull market,» said Noelle Acheson, author of the Crypto Is Macro Now newsletter. Her outlook is driven by incoming macro tailwinds in the form of interest rate easing and other potential policy support such as yield curve control being in the cards to keep markets steady if the global economy turns sour.

That environment should be positive for altcoins, too, she said, with new spot ETFs likely coming to market, turning investor attention to the sector. «The coming quarter should bring the kickoff of ‘alt-season’, as attention starts to turn away from the ‘majors’ (BTC and ETH) and towards smaller, more volatile tokens.»