Bitcoin (BTC) Braces for US Economic Data: What to Watch

Bitcoin (BTC) faces a big week ahead as various key macroeconomic events are scheduled on the US calendar. The impact of these data releases on the crypto market has regained importance after a period of diminishing influence in the second half of 2023.

Several key macroeconomic events are lined up on the US calendar this week, which could have a significant impact on Bitcoin (BTC) and the broader crypto market.

After a period of diminishing influence in the second half of 2023, the impact of these data releases on the crypto market has regained importance.

Crypto traders and investors should prepare for potential volatility as the week starts.

Here’s a closer look at the events to watch:

1. Trumps Interview With Musk

On Monday evening, August 12, former US President Donald Trump will engage in an interview with Elon Musk via X spaces at 8 p.m. ET.

The interview is expected to be unscripted and open to all topics, with Musk inviting everyone to submit questions they would like to see discussed.

Musk is pro-Trump, with reports that the CEO of X created a Super PAC focused on supporting candidates who favor a meritocracy and personal freedom.

“Am going to do some system scaling tests tonight & tomorrow in advance of the conversation with Donald Trump,” Musk said on Sunday.

This comment is made given the platform’s spotty performance last year during an interview with Florida Governor Ron DeSantis.

Indeed, this interview could have implications for Bitcoin and crypto after Trump’s bullish assertions during the Nashville conference.

Both Trump and Musk are pro-crypto, which means the subject will likely spring up in the interview.

2. Core PPI (Wholesale Inflation)

On Tuesday, the US Bureau of Labor Statistics (BLS) will report July’s Core Producer Price Index (PPI).

This data determines price increases at the producer level and influences financial markets by measuring inflation at the wholesale level.

Specifically, increases in PPI indicate increases in production costs. These increases could lead to growing energy and hardware costs requisite for mining and processing cryptocurrencies.

A higher core PPI on August 13 could negatively affect Bitcoin and crypto.

Economists forecast a 2.2% year-over-year increase, four-tenths of a percentage point less than in June.

The core PPI, which excludes volatile food and energy prices, is seen rising 2.7%, compared with 3% previously.

3. US CPI

The BLS is also scheduled to release the July Consumer Price Index (CPI) this week.

This data measures the price increases in consumer goods and services.

While the consensus call is for the CPI to increase 2.9% year over year, the core CPI is expected to rise by 3.2%, with both estimates being one-tenth of a percentage point less than the June figures.

An increase in the CPI may decrease consumers’ purchasing power. This could negatively affect Bitcoin and crypto markets because consumers may tend to spend less when purchasing power decreases.

From another perspective, the decreased purchasing power of fiat currencies could lead to more people turning to alternative assets like crypto.

Here, they see it as a means to protect their wealth from inflation.

In this scenario, an increase in inflation, as indicated by the CPI, would potentially drive up the demand for Bitcoin and crypto in general, ultimately driving up their prices.

4. Initial Jobs Claims

The Census Bureau will report on the US jobs claims on Thursday, detailing July’s retail and food services sales data.

Economists predict a 0.3% month-over-month increase relative to a flat reading in June.

Retail sales could gain 0.1% minus the sale of autos, which is three-tenths of a percentage point less than previously.

Amid recession fears that have kept investors spooked recently, the market hopes to see continued resilience in consumer spending.

“Bitcoin and Ethereum tend to underperform during periods that resemble or approach a recession in the United States.

Additionally, investors are reducing their positions as prices have fallen below the average entry point for ETF investors, which is approximately $60,000,” Markus Thielen, Founder and CEO at 10x Research, recently told BeInCrypto.

5. Consumer Sentiment Survey

Finally, markets will brace for the University of Michigan’s August consumer Sentiment survey, which will be released on Friday.

This data reflects the gap between the US economy’s continued strength and how households feel about their financial situation.

In July, consumers’ expectations of the year ahead inflation was 2.9%, which signified a near a 3-and-a-half-year low.

Expectations for the August 16 release are for a 67.5 reading, about one point higher than previously.

Noteworthy, consumer sentiment is much more sensitive to inflation, while consumer confidence is more sensitive to the labor market.

If the data shows consumers still struggle with inflation and high interest rates while worrying more about their jobs, crypto could react differently.