Political changes in the United States and cryptocurrencies
The cryptocurrency market made notable gains over the weekend, with the total market capitalization hitting a six-week high.
Here are factors that will likely have an impact on the crypto market this week:
1- Inflation data and personal consumption expenditures index
All eyes are on the Personal Consumption Expenditures (PCE) inflation data this week, an important indicator as it is the Fed's preferred measure for assessing inflation.
This data may influence the bank's decision to cut interest rates expected in September.
2- Political changes in the United States
The major change in the US presidential election race with Joe Biden stepping down could have a major impact on markets in this week full of economic events.
3- S&P Global Index and Purchases Index
Preliminary readings for the S&P Global Manufacturing Index and Services PMI for July are due on Wednesday.
These reports provide an overview of business conditions in the U.S. manufacturing and service sectors.
4- GDP growth report
The annual GDP growth report for the second quarter of 2024 will be released on Thursday, which provides a preliminary look at the change in GDP.
The pace of GDP growth is estimated to have accelerated to 2% in the second quarter, compared to 1.4% in the first quarter.
A higher-than-expected reading could delay expectations of interest rate cuts from the central bank.
5- Core Personal Consumption Expenditure Report
The main report this week is the core personal consumption expenditures report for June, due on Friday.
This report reflects the average amount of money consumers spend each month, a key measure of inflation for Fed policymakers.
Slowing PCE inflation and continuing deflationary trend will enhance the prospects for a rate cut in September.
6- Michigan Consumer Confidence Index
On Friday, Michigan's July Consumer Confidence Index and Consumer Inflation Expectations reports will also be released, which will provide additional insights into longer-term inflation.
All of them are factors that may affect, in one way or another, the cryptocurrency market and may contribute to the rise in the price of Bitcoin, and their impact may also be negative.
