As Bitcoin hovers around the $44,000 mark, investors are gripped by the anticipation of two significant data releases. Developments on the macro front have been positive, with Federal Reserve Chair Powell now clearly indicating rate cuts for the coming year. The question arises: why are today’s data releases critical, and what awaits investors tomorrow?
Critical U.S. economic data was released a few minutes ago, revealing the current state of the country’s economy and employment sector. Mid-month saw Bitcoin prices fluctuate due to robust employment figures, highlighting the impact of labor market data on cryptocurrency valuations.
The Federal Reserve has signaled that it will begin cutting interest rates by the second half of 2024 at the latest. According to FedWatch, there is even a possibility of rate cuts starting as early as March, with a probability exceeding 60%. Financial markets have already begun to price in these anticipated reductions as the end of rate hikes seems imminent.
The latest data and expectations are as follows: the U.S. Gross Domestic Product (GDP) came in at 5.2%, aligning with both expectations and previous figures. Unemployment claims were reported at 205K, slightly below the anticipated 215K but not significantly off from the prior 202K.
While the unemployment claims were slightly better than expected, they were not alarmingly low. The GDP figure met expectations, casting a relatively positive light on the economic outlook. Now, the focus turns to tomorrow’s Personal Consumption Expenditures (PCE) price index, a key inflation indicator watched by the Fed. It is crucial for this data to come in low to maintain Bitcoin’s position above $44,000.