- Let’s run through the macro data that came out this week
- And see what news influenced the BTC charts
Every Monday we prepare an economic calendar for readers. It helps you track investor sentiment and predict your actions. Now let’s summarize. Let’s look at the economic week and the market in general perspective.
Monday. Positive reports from EU and UK, Gensler hunt
The week started with good EU news and set the stage for the euro to rise. Production of industrial companies in the Eurozone increased by 1.0% in April, according to Eurostat. This was better than analysts expected (they predicted growth of 0.9%). Also came positive reports from the UK Labor Department – the unemployment rate fell by 0.1 p.p. to 3.8%. Experts were expecting unemployment at 4%.
Also on Monday, Republican U.S. Congressman Warren Davidson tweeted that he was filing a bill to restructure the SEC and fire its current chairman, Gary Gensler.
“The U.S. capital markets should be protected from a tyrannical chairman, including the current. That’s why I’m introducing legislation to correct the ongoing abuse of power and provide protections that are in the best interest of the market for years to come.”
Following this, Bitcoin added 1.00% and was trading at around $26,200.
Wednesday. Falling inflation in the U.S., a small victory for Binance and the publication of the Hinman documents
On Tuesday, a federal court rejected the SEC’s request to freeze the assets of Binance.US. This decision allows the platform to continue operating while it disputes the lawsuit. BTC added 1% on such news.
June 13 U.S. consumer prices came out. They came in unexpectedly below forecasts at 4% instead of the expected 4.1%. Core inflation, excluding energy and food prices, rose 5.3% from May 2022 levels.. This was in line with market expectations. On a monthly basis, prices of basic goods and services rose 0.4 p.p.
This inflation data gave the Fed reason to hold off on raising rates.
Also on Tuesday, the SEC was forced to disclose the long-awaited Hinman documents. However, this publication had no effect on Ripple coin quotes and the market as a whole. So the expectations of this event were not met.
Remind that the notes to Hinman’s speech state that ether should not be classified as a financial security. Experts hoped that this would not only defend Ripple in court with the SEC, but also in general to avoid attacks on the securities. However, Hinman’s documents essentially prove only that the SEC has no way of deciding whether to classify tokens as commodities or securities.
Wednesday. Tactical pause from the Fed and Powell’s speech
The Fed met on Wednesday. It brought the expected results: The U.S. central bank left interest rates unchanged at 5% to 5.25%. That rate is at its highest level since 2006 after ten consecutive hikes.
But the Fed’s decision did not lift the mood in the crypto and capital markets.. Chairman Powell’s speech was the culprit. He hinted at two more rate hikes before the end of 2023.
For crypto, that means less capital will flow into cryptocurrency markets in the short term. And investors will be fleeing to more stable assets – especially amid tough action by the U.S. SEC.
The next Federal Open Market Committee meeting is scheduled for July 25-26.
The CME FedWatch tool predicts a 25.6% chance that the Fed will leave rates as they are at the July meeting, while a 74.4% chance says the Fed will raise rates by 25 basis points.
Thursday. ECB Decision, U.S. Labor Market Reports and Crypto Market Decline
We saw the outcome of the Fed meeting and Powell’s hawkish speech on the charts Thursday morning.
Bitcoin fell 4% and was trading at a low of $24,797. This was the lowest rate since March 16. Other cryptocurrencies showed even greater losses.
Also yesterday, the European Central Bank raised its rate by 0.25% to 4%. This is the eighth consecutive rate increase. And another negative factor for the market.
At the end of the day came the report of initial jobless claims in the U.S.. Their number was higher than predicted (262,000 instead of 250,000). This is favorable, as it indicates the first success of the Fed in suppressing inflation. But that metric was negative for the strength of the dollar, so the DXY was down slightly.
The data didn’t end there- yesterday was a very busy day of reports.. The U.S. reported retail sales, which unexpectedly rose 0.3 percent versus an expected 0.1 percent.
Also on Thursday, the New York Fed’s core index of doing business, in conjunction with Empire State Manufacturing, came out. It rose to 6.6 in June (experts had expected a negative index of -15.1). This is the second consecutive monthly increase. The rising index indicates that companies have become more optimistic about improving business conditions.
Friday. Bank of Japan’s decision
The Bank of Japan (BoJ) today left prime rates unchanged. They explained this by the fact that it is more difficult to combat the effects of a premature rate increase than to respond to rising inflation. As a result, the USD/JPY pair gained bullish momentum and added over 0.5% overnight.
After yesterday’s ECB decision, the dollar index (DXY) fell to weekly lows of 102 p.p.. The euro hit its 15-year high against the Japanese yen and a new four-week high against the dollar after the ECB yesterday raised interest rates to a two-year high of 3.5% and announced further hikes.
Investors are waiting today for Federal Reserve officials to speak and comment on the economic outlook.
Meanwhile, Bitcoin began to recover from yesterday’s slump. It has gained 2.05% overnight and is trading at $25,573. But over the week, BTC lost 3.83%.
The Solana token showed the largest weekly decline among the top 10. That’s because it was flagged as illegally issued financial securities by a U.S. regulator last week.
Robinhood has delisted Cardano, Polygon and Solana, and the eToro platform has suspended users from buying Polygon, Decentraland, Algorand and Dash, all named in SEC legal filings.
This ends the trading week. Don’t miss our new economic calendar on Monday. Also, don’t forget to follow the latest news on our website. Have a great weekend, everyone!