Four key US economic events are set to impact the cryptocurrency markets this week.
The first and one of the most anticipated data points is the initial jobless claims report, scheduled for Thursday, 17 October 2024. This report offers a snapshot of the US labor market, which has shown signs of softening but remains relatively strong.
Low unemployment rates, coupled with steady job growth, can indicate a tightening labor market. This, in turn, raises concerns about inflation, as rising wages could contribute to upward price pressures.
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Retail Sales Data To Reflect Consumer Confidence
Another major focus will be the retail sales report, also set for Thursday. This data will offer a glimpse into consumer spending behaviour for the month of September, following a modest 0.1% increase in August.
Economists are forecasting a 0.7% month-over-month (MoM) rise in retail sales, which would indicate a resilient economy despite concerns about a potential recession.
From a crypto perspective, strong retail sales suggest that consumers are confident and willing to spend, which could lead to increased investment in riskier assets like Bitcoin. On the flip side, weak sales figures might reflect a slowing economy, potentially pushing investors to diversify their portfolios by including cryptocurrencies.
US consumers' inflation expectations for the next 5-10 years skyrocketed to 7.1% in October, the highest in over 40 years.
This metric has DOUBLED in just several months, according to the University of Michigan Consumer Survey.
To put this into perspective, median inflation… pic.twitter.com/EZIo5ioAWU
— The Kobeissi Letter (@KobeissiLetter) October 13, 2024
The third economic event to watch is the release of industrial production data. This report tracks the performance of the manufacturing sector, which plays a crucial role in overall economic growth.
Strong industrial production numbers are typically seen as a positive sign for the economy, potentially boosting investor sentiment. In the context of the cryptocurrency market, positive industrial data could encourage more investment in digital assets.
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Corporate Earnings To Influence Market Sentiment
In addition to economic data, several major corporate earnings reports are scheduled this week, including releases from Bank of America (BAC), Citigroup (C), and Charles Schwab (SCHW). These earnings will offer insights into the financial health of key companies across different sectors in the U.S. economy.
Strong corporate earnings often lead to positive market reactions, driving up stock prices and boosting investor confidence. This optimism can spill over into the cryptocurrency market, as investors seek higher returns in a favorable economic environment. Conversely, disappointing earnings could contribute to increased volatility and risk aversion in both traditional and digital markets.
The interplay between these traditional economic indicators and the crypto market is complex. A generally positive economic outlook—marked by strong retail sales, declining jobless claims, solid industrial production, and upbeat corporate earnings—could drive more interest in cryptocurrencies.
However, any negative surprises in the data may heighten volatility across both traditional and crypto markets.
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Disclaimer: Crypto is a high-risk asset class. This article is provided for informational purposes and does not constitute investment advice. You could lose all of your capital.
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