Crypto and stock markets face a packed macro week, with CPI, PCE, Fed minutes and spending data set to test rate‑cut bets after mixed inflation and rising tensions.
Summary
- January CPI eased to its lowest core reading since 2021, briefly lifting crypto before gains faded.
- Markets now focus on retail sales, durable goods, PCE and Fed minutes to gauge rate‑cut timing.
- Bitcoin and Ethereum stay volatile as geopolitical risks and macro uncertainty cap risk appetite.
Financial markets are preparing for several key economic data releases this week that could influence cryptocurrency and stock prices, following mixed signals from last week’s inflation data.
January’s Consumer Price Index came in slightly below expectations, with headline inflation at 2.38% year-on-year and core CPI at 2.5%, marking the lowest level since early 2021, according to government data. The figures initially boosted stock and cryptocurrency markets on Friday, though cryptocurrency gains retreated over the weekend.
Traditional U.S. markets will be closed Monday for the President’s Day holiday. The ADP employment update is scheduled for Tuesday, followed by the January Retail Sales report. Wednesday will bring consumer spending data with the delayed December Durable Goods Orders numbers, along with Federal Reserve meeting minutes and 10 central bank speaker events.
The December Personal Consumption Expenditures (PCE) inflation report, considered a key indicator by the Federal Reserve, is expected to be released later this week. Goldman Sachs raised its PCE outlook following the January CPI data, estimating that the core PCE price index rose 0.40% in January, according to reports. The economists attributed the projection to rising consumer electronics and IT prices, which carry heavier weighting in PCE calculations than in CPI. A global shortage of RAM and storage components, driven by AI data center demand, has contributed to increased computer and component prices.
The CME Fed Watch Tool shows a 90% probability that interest rates will remain unchanged at the Federal Reserve‘s March meeting, according to current market pricing.
Cryptocurrency markets have declined in the past 24 hours, with total market capitalization falling. Bitcoin retreated from recent highs during early Asian trading on Monday and has remained rangebound for the past ten days. Ethereum prices have fallen sharply, while alternative cryptocurrencies have continued to decline.
The Kobeissi Letter noted that geopolitical tensions and macroeconomic uncertainty remain elevated, cautioning that volatility could continue this week.
