- Bitcoin faces volatility as tightening liquidity and U.S. economic data release may shift crypto market sentiments.
- FOMC minutes, CPI data, and other key indicators this week could cause sharp moves or reversals in crypto.
The crypto market is now within a critical week, with Bitcoin dropping to $75,000. Investors are waiting for pivotal U.S. economic reports that could shift the market sentiments. Market instability, driven by tightening liquidity and lingering uncertainty, hangs in the balance as data releases near the dates. After last Monday’s sharp sell-off, traders are on edge for the next crypto move.
Five key data points from the U.S. will either ignite market momentum or cause a reversal. From inflation reports to jobless claims, every event holds the impact to shift the market in any direction.
1: Fed Minutes — Will Powell Tip His Hand Early?
The Federal Open Market Committee (FOMC) scheduled to release this Wednesday will be a key indicator for traders to gauge market sentiments. Inflation, interest rates, and economic growth will be discussed in the meeting which have a huge impact on the crypto market movements. If the decision tends to be fewer rate cuts, the investors will find safe traditional options like dollars and government bonds.
But if the Fed leans dovish—hinting at future rate cuts—the risk-on crowd could return, possibly pushing Bitcoin higher. As one user put it:
The next FOMC meeting is on the first week of May, can investors wait? Can US people wait? How high is current inflation?
Fed Chair Jerome Powell might stick to his usual caution, resisting any rush to ease policy. Still, any deviation in the minutes from what’s already priced into markets could trigger sharp, sudden swings.
2: Thursday’s CPI Data Could Break the Calm
Right after the Fed’s words settle, Thursday brings the Consumer Price Index (CPI). This inflation tracker is a make-or-break moment. The last reading showed cooling inflation at 2.8% in February. Now, expectations are locked on a 2.6% annual rise. If the number runs hotter, it could rattle markets all over again.
A spike would suggest that inflation is still stubborn, giving the Fed cover to delay cuts. That could pressure crypto, with Bitcoin possibly falling further. On the flip side, if the CPI comes in soft, crypto may rally as investors smell cheaper borrowing and stronger liquidity.
3: Jobless Claims: An Early Thursday Test
Before CPI, the market gets its first temperature check through Thursday’s Initial Jobless Claims. These numbers reflect new unemployment filings and give an immediate sense of how the job market is holding up. The latest data pegged weekly claims at 219,000.
A lower reading this week could signal strength in the economy, which might dim Bitcoin’s appeal as traders favor stocks. But if jobless numbers spike, it might reignite recession fears. That kind of news often boosts crypto, especially Bitcoin, as a hedge.
“US Core Inflation Rate and CPI (Thu10) and Initial Jobless Claims (Thu10) are top-tier market movers, likely impacting USD, bond yields, and Fed rate expectations amid tariff uncertainties,” one user said.
4: PPI Could Add Fuel or Cool the Fire
Friday brings another inflation gauge—the Producer Price Index (PPI). This measures wholesale-level inflation and hints at future consumer price trends. If the number for March comes in well above the 3.3% year-over-year mark, it might suggest trouble ahead.
Higher producer costs, especially for energy and materials, could impact crypto-mining economics and overall market sentiment. A steep jump might force the Fed to stay hawkish, making risk assets like Bitcoin less attractive in the short run. However, if the PPI is tame, it might reinforce hopes for looser policy—especially if CPI was also soft.
“Massive macro week ahead FOMC minutes, CPI, and PPI. A battleground for rate cut bets,” Deribit noted.
5: Consumer Sentiment May Tip the Scales
Rounding out the week is the University of Michigan’s Consumer Sentiment Index, dropping Friday. This data offers a look into how everyday Americans feel about the economy. Optimism here can fuel spending and risk-taking, giving Bitcoin a tailwind.
If the number falls below the 54.5 expectation, it could suggest rising anxiety over inflation or job stability. That could lead to risk aversion, weighing down crypto further. But if people feel good about the economy, risk appetite may return—always a plus for digital assets.
