Fed Policy in Focus: Upcoming Jobs and Inflation Reports May Shake Crypto
This week, several significant US jobs and inflation statistics are due. This might cause market and cryptocurrency volatility to soar. As liquidity declines, the spotlight is on Fed policy expectations. The reports come after weeks of high volatility. In order to evaluate macroeconomic conditions, investors are keeping an eye on labor data and inflation measures. Market experts claim that cryptocurrency markets have traditionally shown sensitivity to macroeconomic changes, especially those that impact interest rate forecasts.
PPI, PCE, and Unemployment Figures in Focus for Market Movers
The Producer Price Index (PPI) data, which gauges wholesale inflation, will be released on Tuesday, November 25. Potential increasing pressure on consumer prices is usually indicated by rising PPI statistics. Economists believe that this could impact monetary policy decisions made by the Federal Reserve.
The first data on unemployment claims will be made public on Wednesday, November 26. This offers a better understanding of the state of the job market. According to analysts, the metric shows whether layoffs are rising, which might be a sign of economic momentum. In the past, higher unemployment claims have been seen as confirmation of expectations for a more accommodating Federal Reserve policy. Investors can use these signals to predict how the Fed will respond at future meetings.
On Wednesday, November 26, the Federal Reserve’s preferred inflation indicator, the Personal Consumption Expenditures (PCE) Index, will also be issued. The PCE Index accounts for substitution effects when measuring consumer spending patterns. This report is considered by market analysts to be the most significant data release of the week. Because of the decreased trading liquidity ahead of the Thanksgiving weekend, they think it could lead to volatility in Bitcoin and other digital assets.
Thanksgiving Could Spark Increased Bitcoin Volatility Amid Thin Markets
Thanksgiving will cause the U.S. stock markets to close on Thursday, November 27. On Friday, November 28, they will run on a reduced schedule. Thus, there is less liquidity across all global risk assets for two days. According to trading data, low-volume trading circumstances have traditionally increased price volatility in bitcoin markets. Market gurus warn that the concentration of macroeconomic data releases prior to the Thanksgiving break could lead to higher market volatility.
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