Bitcoin overview week 30: exciting week ahead with interest rate decisions

It’s Sunday again and that means we can get ready for another week full of macroeconomic fireworks. In recent weeks, we have seen inflation fall sharply, America is in a technical recession on a gross domestic income (GDI) basis, industrial product is down year-on-year, commercial bank lending is declining, the yield curve is still inverted, and many more factors pointing to a recession.

The most important factor in that story, of course, remains US interest rates, which determine the ultimate price of capital. In a sense, interest is the foundation of the economy.

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Overview macroeconomic data week 30

In that respect, next week will be an important one, because on Wednesday 26 July it will be the turn of the Federal Reserve (American central bank) to take a new interest rate decision. For the time being, the market expects a new interest rate increase from the current 5.25 to 5.50 percent with 99 percent certainty.

Despite the fact that the consumer price index fell to 3.0 percent, core inflation is at 4.8 percent, producer price inflation (PPI) came in at 0.1 percent, and many alternative sources of inflation reported even lower scores, the Federal Reserve apparently wants to raise interest rates again.

This may be a mistake, as the economy is starting to show weakness in several areas (see introduction). The only bright spot for the Federal Reserve remains the US labor market, which remains surprisingly strong with an unemployment rate of 3.6 percent. That does not alter the fact that we should not forget that interest rates have already risen from 0.25 to 5.25 percent.

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Those increases took place over a period of 15 months, after the Federal Reserve had spent ten years (!) accustoming the economy to an interest rate of practically zero percent. In that regard, it seems mostly wishful thinking to think that with these rates we can avoid a recession.

It is especially interesting to watch Jerome Powell’s press conference after the interest rate decision. You can find it on the Federal Reserve’s YouTube channel. The live stream for this starts at 8.30 pm Dutch time.

Then on Thursday 27 July it is the turn of the European Central Bank (ECB) to take a new interest rate decision. The ECB, like the Federal Reserve, is expected to raise interest rates by 0.25 percent.

Furthermore, on that same Thursday we will receive important data about the US labor market in the form of the number of unemployment claims for the past week. Finally, on Friday, July 28, we will receive an interest rate decision from the Bank of Japan and the United States Core PCE Price Index, one of the main inflation indicators for the Federal Reserve.

All in all, a week to look forward to on a macroeconomic level!

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So it can be another exciting week in terms of macroeconomic figures and therefore possibly also for bitcoin. Would you like to receive this kind of information earlier and know what the impact of these figures is on the market? This is what we talk about in the Premium environment of Crypto Insiders. You can also ask experienced traders questions here and our analysts share weekly 20 exclusive technical analyzes of an extensive range of cryptocurrencies. Take a look at our Premium information page and try the first 30 days for free.

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