CPI and PPI Reports in Focus This Week
Cryptocurrency market participants need to monitor three pieces of U.S. economic data this week that could impact Bitcoin (BTC) sentiment and lead to volatility. After a dry spell in 2023, there has been interest this year as U.S. macroeconomic data had a significant impact on the Bitcoin and cryptocurrency markets.
Meanwhile, Bitcoin price remains just under $100,000, hovering in the $99,000 range throughout the weekend.
3 U.S. Economic Data That Could Impact Bitcoin Price This Week
This week will be packed with events, with the following U.S. economic data expected to drive volatility in the Bitcoin and altcoin markets.
US consumer price index
The US CPI (Consumer Price Index) is the focus of this week’s US economic data. Release is expected on Wednesday, December 11 at 8:30 AM ET. Published by the U.S. Bureau of Labor Statistics (BLS), this macroeconomic data measures monthly changes in prices paid by consumers, effectively tracking inflation over time.
The U.S. Bureau of Labor Statistics (BLS) revealed in the previously released U.S. Consumer Price Index (CPI) data Inflation rises to 2.6%. Specifically, inflation held steady at 0.2%, unchanged from September’s figure. However, the annual growth rate of 2.6% was the first increase in eight months.
This has triggered speculation that the Federal Reserve will tighten policy. However, Institutional Interest in Bitcoin Boosting the value of the pioneer cryptocurrency, it continues to attract demand as it continues to be attractive as a store of value.
The median forecast is 0.3%, which means prices are expected to rise 0.3% month-on-month according to economists’ forecasts. This would be higher than September’s 0.2% month-on-month increase. The consensus among Wall Street economists is 2.7%.
All eyes will be on the Labor Department on Wednesday as U.S. inflation data takes center stage. In addition to the headline data, core consumer price index (CPI) inflation will also be a key focus this week, which provides a more stable inflation data because it excludes food and energy prices from the calculation.
Core CPI inflation is a focus because commodity prices tend to vary widely and unpredictablely from month to month and have little to do with consumer demand. In November, core CPI is expected to rise 3.3% from the same period last year. If that happens, it would be the fourth consecutive month of growth of 3.3%.
Meanwhile, core prices are expected to rise 0.3% monthly, also in line with October’s gain.
Due to its decentralized nature and limited supply, Bitcoin is considered a hedge against inflation. On Wednesday, BTC may benefit from an upward trend in US CPI and core CPI.
For the uninitiated, if investors believe rising inflation poses a threat to the purchasing power of traditional currencies like the U.S. dollar, they may turn to alternative assets like Bitcoin as a store of value. This increase in demand could push the price of Bitcoin higher.
Number of people filing for unemployment benefits for the first time
A report on U.S. initial jobless claims for the week ended December 7 will be released on Thursday. The data will provide insights into the health of the labor market and the overall economy.
Typically, high levels of unemployment filings indicate economic hardship and uncertainty. On the other hand, low levels indicate a strong job market and a stable economy.
Unemployment insurance claims increased to 224,000 in the week ended November 30. The print’s circulation was higher than the original estimate of 215,000 copies. This was also up from 215,000 the previous week (revised to 213,000).
According to Bureau of Labor Statistics employment data dataHowever, the U.S. job market rebounded slightly in November. The unemployment rate rose to 4.2%.
Specifically, the United States added 227,000 nonfarm payrolls (NFP) in November, following a soft labor market in October. This comes amid the Boeing strike and the aftermath of Hurricane Milton.
“The latest jobs data suggests the labor market remains strong. After weak data in October due to weather and worker strikes, November rebounded with strong job growth and an upward revision.” Senior Economist, Economic Policy Institute “The economy has added an average of 173,000 jobs over the past three months,” said Elise Gould. ” shared.
Thursday’s high number of jobless claims could add to the negative impact and uncertainty on market sentiment. This may lead investors to seek safe-haven assets, e.g. gold Or Bitcoin. Increased demand for Bitcoin as a store of value could push its price higher.
Likewise, high unemployment claims could signal weakness in consumer spending and economic growth. This may affect the central bank’s implementation of expansionary monetary policy. Such results may increase concerns inflation Currency depreciation has prompted investors to turn to alternative assets such as Bitcoin to protect their wealth.
US producer price index
Additionally, on Thursday, the Bureau of Labor Statistics will release the Producer Price Index (PPI), a reading of wholesale inflation. This data measures the average change over time in the sales price of output of domestic producers.
This week’s CPI and PPI price data will be the main determinant of the Fed’s interest rate decision this month. What the data shows will mark an important milestone in the field The Fed’s policy adjustment plans. Notably, this marks the last week of inflation data before the December Fed meeting.
“All eyes will be on CPI and PPI inflation data as markets look to cement another quarter-point rate cut,” Kobeissi wrote explain.
Meanwhile, BeInCrypto data shows The market fell todayas of this writing, Bitcoin is trading at $99,147, down 0.68%.
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