US economic data that could shake Bitcoin this week

Crypto markets should be buoyed for volatility this week by four US economic data that could impact investors' portfolios.

These macroeconomic data come as Bitcoin (BTC) remains below the $100,000 mark. Analysts expect more downside from Donald Trump's inauguration in seven days, but a glimmer of hope remains.

PPI

On Tuesday, US PPI (Producer Price Index) data will be released, a report by the US Bureau of Labor Statistics (BLS) is expected to have crypto implications. In particular, the US PPI report provides insight into inflation at the producer level. It also provides early indications of future consumer prices, and therefore, can affect investor sentiment.

This week's US PPI report shows December's producer-level inflation, the average forecast of 0.3%, down from 0.4% in November. November data beat forecasts and consensus expectations, marking the fifth straight month of PPI. The producer price index in November indicated that inflation is still continuing.

With higher interest rates, the Fed's battle against inflation is far from over. So, financial markets including crypto will be watching this US economic data on Tuesday. Any significant deviation from the expectation can affect the relative estimates and market sentiment.

CPI

Alongside the Producer Price Index (PPI), the US Consumer Price Index (CPI) is a key focus in this week's economic data. Last week's FOMC minutes hinted that the Fed may soon cut interest rates amid policymakers' concerns about the potential inflationary effects of President-elect Donald Trump's proposed policies.

According to Reuters, economists expect year-over-year (yoy) headline CPI inflation to rise slightly to 2.8% from November's 2.7%, with forecasts ranging between 2.6% and 2.9%. It is said that the inflation of food and energy prices may rise to 3.3 percent.

As the market waits for the release of the CPI on Wednesday, higher-than-expected inflation may cast doubt on the Fed's ability to cut interest rates. This concern is exacerbated by the inflationary impact of Trump's proposals. Such developments could strengthen the US dollar, which could put downward pressure on Bitcoin.

“I think we'll get back to $100,000 if we don't wear PPI and CPI data,” said one crypto market participant.

Blackrock earnings

Key earnings reports this week include BlackRock, Citigroup, Goldman Sachs Group, JPMorgan Chase and Wells Fargo on Wednesday, Bank of America and Morgan Stanley on Thursday.

BlackRock Report closely follows institutional interest in Bitcoin and Ethereum due to its strong role in fueling institutional interest in IBIT and ETHA ETFs (exchange-traded funds).

“Waiting to hear dividend increase announcement from BlackRock,” wrote one popular user on X.

The increase in BlackRock's profit margin may indicate that the company sees its Bitcoin-related products as profitable and sustainable. Such a move could attract more institutional investors and boost credibility for the cryptocurrency market.

Institutional players look for signs of stability and profitability before entering new markets. BlackRock's positive signal could encourage institutional acceptance of Bitcoin and Ethereum, which could lead to price growth and wider market acceptance.

Initial unemployment claims

The weekly unemployment claims report released on Thursday summarizes a series of US economic events that could impact the crypto market. Initial Jobless Claims tracks the number of first-time jobless benefits filed in the previous week, providing a snapshot of the labor market's performance.

The latest data showed that US job growth unexpectedly accelerated in December, while the unemployment rate fell and weekly jobless claims hit a record low of 201,000. Additionally, the November JOLTS report from the Bureau of Labor Statistics showed a surprising increase of nearly 8.1 million job openings, indicating a strong end to the labor market in 2024.

Crypto markets will be closely watching Thursday's unemployment claims for signs of a softening labor market. The median forecast is 210,000. The below-expected claims point to continued strength in the labor market, which points to steady consumer spending and a strong economy.

However, such strength could prompt the Federal Reserve to consider raising interest rates, which could boost the dollar but weigh on Bitcoin.

“The labor market is closely tied to consumer spending, which drives much of the U.S. economy. A healthy labor market boosts self-confidence and economic growth. Rising unemployment can signal future economic trouble,” shared a user on X.

At the time of writing, Bitcoin is trading at $94,045, down 0.5% since the opening of Monday's session, according to BEncrypto data.

It's worth mentioning that this week's US macroeconomic data comes ahead of a huge event for crypto in the US. On Monday, January 20, a market holiday, President-elect Donald Trump will be inaugurated. As part of his inaugural address to the nation, Trump could pledge to a US Bitcoin Strategic Reserve.