Crypto Market on Edge: 3 Major US Economic Events to Watch This Week

• Bitcoin is trading between $57,000 and $60,000, with traders hopeful for better market conditions in “Uptober.”

• Key US economic events this week include the release of retail sales data and the FOMC interest rate decision.

Bitcoin (BTC) continues to trade within a narrow range, fluctuating between the $57,000 threshold and the psychological $60,000 level. Despite common market conditions in September, crypto traders still have high hopes for ‘Uptober’. The focus is now on several important macroeconomic events in the United States that may affect the BTC price in the near future.

US Retail Sales Data Could Trigger Market Movements

The Commerce Department’s Census Bureau will release the US retail sales report to help understand consumer spending. The July data showed an increase of 1%, contrary to the previous month when the figure was revised to -0. 2%. Consumer spending that remains high is usually a positive sign for the economy. It reduces the risk of a recession and hence increases investors’ confidence in risking their funds in assets like Bitcoin.

The retail sales figures for August are important as strong data may indicate that the economy remains healthy. Moderate consumer spending often leads to overall economic development and boosts investments in cryptocurrencies and stocks. On the other hand, a decline in retail sales could raise economic worries and cause investors to become more cautious. 

FOMC Interest Rate Decision Takes Center Stage This Week

The upcoming Federal Open Market Committee (FOMC) meeting is the week’s highlight. In light of the recent economic indicators, the markets expect a rate cut as the inflation softens. The CME FedWatch tool shows that there are about 56. 9% chance of a cut of 50 basis points and 43. 1% chance of a cut of 25 basis points. A 50 bps cut could be unexpected, which may lead to fluctuations in the market. However, a 25 bps cut would be in line with market expectations. Thus, the market reaction is expected to be moderate. 

JPMorgan proposes a 50 bps cut, arguing that the monetary policy needs to be more proactive in adjusting rates. However, this approach could imply a range of economic problems, and this may affect the risk-savvy investments such as Bitcoin. 

US Unemployment Claims Offer Insight into Labor Market Health

Other important economic data include the initial jobless claims that are expected to be released later in the week. Despite certain negative trends that can be observed in the job market, the rates of unemployment are still rather low. In August, the US economy added only 142,000 jobs, which was slightly worse than expected but in line with the ongoing healing of the labor market. 

The unemployment rate was 4. 2% in August, which is in line with expectations, with a tiny improvement on the 4. 3% recorded in July. An increase in the number of people filing for unemployment benefits may signal some economic vulnerability, which may cause investors to move their funds to other assets, including cryptocurrencies, in order to protect themselves from potential losses in the traditional markets. However, its effects on Bitcoin may not be as immediate as compared to other economic variables such as retail sales or interest rate decisions.