5 US Economic Events That Could Impact Crypto Market This Week

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As a seasoned researcher with years of experience analyzing economic data and its impact on cryptocurrency markets, I find myself constantly monitoring key US economic reports to gauge their potential influence on portfolio strategies. With the year-end rapidly approaching, the upcoming labor market reports are particularly significant, as they hold great weight in the eyes of the Federal Reserve.

This week, cryptocurrency markets are keeping a close eye on crucial U.S. economic data to gauge the state of the country’s economy as we near the end of the year. Notably, significant labor market figures – which the Federal Reserve closely observes – have been scheduled for release.

Considering the possible effects on investments, traders might tweak their approaches to align with these approaching occurrences.

ISM Manufacturing

On Monday, December 2, which is the start of the new month, The Institute for Supply Management (ISM) will disclose the November ISM Manufacturing data. Known alternatively as the Purchasing Managers’ Index (PMI), this index provides a monthly overview of the economic activity happening in the United States. It is compiled from surveys sent to purchasing managers at various manufacturing companies nationwide, and it serves as an essential indicator of the overall health of the U.S. economy.

The ISM Manufacturing Index follows weak trends seen in Eurozone purchasing manager surveys, where businesses have been reducing their workforce for four months straight. The Eurozone Composite PMI fell to 48.1 in November, down from 50.0 in October, suggesting a contraction. Likewise, UK economic surveys showed an unexpected slide into contraction for the first time in over a year, primarily due to worries about increased employment taxes and higher export tariffs.

After observing this data, it appears that the Euro has dropped to its lowest point in nearly two years, reaching $1.0336. Now, the focus of the market shifts towards the U.S., where the predicted ISM manufacturing index for November is 47.5, compared to the previous month’s reading of 46.5. If a similar downturn happens in the U.S., potentially weakening the dollar (USD), I believe that investors might start favoring Bitcoin (BTC) and other cryptocurrencies as a means of protection against economic instability.

JOLTS Job Openings

On Tuesday, December 3rd, the United States Bureau of Labor Statistics (BLS) is scheduled to publish the Job Openings and Labor Turnover Survey (JOLTS) for October. This publication will offer insights into the shift in job openings during October, along with the counts for layoffs and resignations.

The information gives us important understandings about the balance between work availability and need in the job market, a crucial factor influencing wages and prices. Looking back, there’s been a continuous decrease in job vacancies in the U.S., starting from over 12 million in March 2022. This trend indicates a gradual improvement in labor market conditions.

By August 2024, the decreasing trend in job openings came to a halt, with the number rising to an impressive 8.4 million from 7.7 million in July. The following month, September, registered 7.44 million job openings. It’s worth mentioning that the condition of the job market plays a crucial role for Federal Reserve officials when formulating policy. Currently, predictions suggest a minor uptick to around 7.49 million job openings in October, as the impact of the hurricane and strikes gradually lessens.

Nonfarm Payrolls (ADP Private)

As an analyst, I’ll be keeping a close eye on the ADP National Employment Report due out on Wednesday, December 4th. Often referred to as nonfarm payrolls, this crucial economic indicator will shed light on the number of jobs added within the private sector and government agencies during November.

Looking back, the October employment report startled financial markets as hiring dropped to its lowest point since the pandemic, with only 12,000 jobs added – significantly less than the anticipated 106,000. Despite forecasts of a slowdown due to Boeing strikes and hurricanes, the scale of job loss was unexpectedly large.

Boosting the element of surprise even more, the ADP report indicated a substantial increase over September’s 159,000, climbing up to 233,000. The disappointing job growth in October supports the expectation that the Fed will consider reducing interest rates in their upcoming meeting.

Despite the overall pattern showing a decrease in hiring, the Bureau of Labor Statistics (BLS) has adjusted downward its figures for the past two months by 112,000 jobs. However, it’s worth noting that there could be a degree of confirmation bias when making such an argument.

Initial Jobless Claims

This Thursday, December 5th, the weekly unemployment figures will offer insights into the current state of the U.S. job market. Last time, the initial unemployment claims stood at 213,000 for the week ending November 23rd. Analysts predict that these numbers might have slightly increased to around 215,000 for the previous week.

Over the past few weeks, weekly unemployment claims have been gradually decreasing since reaching a peak in October that was over a year high. However, while initial jobless claims are dropping, continuing jobless claims are increasing. This suggests that employers are making efforts to keep their workers for as long as they can, but employees who lose their jobs are finding it challenging to find new employment.

US Employment Report

The U.S. labor market data for November is set to be released on Friday, December 6th. This report will provide a summary of economic statistics related to employment in the United States for the previous month. Economists predict that the November jobs report will indicate an increase of over 250,000 new jobs. Approximately 33,000 Boeing workers are anticipated to return from their strikes and resume work at suppliers following Hurricane Milton.

Next month’s data, released on a Friday, may follow the disappointing core Personal Consumption Expenditure (PCE) price index for October, which did not meet predictions. This could mean that the Federal Reserve will prolong their cycle of reducing interest rates at their upcoming meeting.

Analysts at Deutsche Bank have indicated that the upcoming US jobs report, due out on Friday, is the most significant piece of data to be released next week prior to the Federal Reserve’s decision on December 18th.

As I’m preparing to delve into the upcoming US economic data, at the moment, Bitcoin (BTC) is being traded at approximately $96,516, marking a minimal 0.15% increase compared to the commencement of Monday’s trading session.

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2024-12-02 12:36