Next week’s top macro events: A turning point for the crypto market
As we approach the end of April, market participants are anxiously awaiting another week filled with a series of potentially influential macro events. From central banks’ interest rate decisions to key economic data, these events can have a significant impact on the stock and crypto markets.
These macro events could drive the crypto market trend next week!
Over the past few days, the crypto market has experienced dramatic swings due to concerns about potential interest rate hikes in the coming week. However, the landscape quickly changed when the collapse of First Republic Bank sent ripples through the market. As investors prepare for the week ahead, anticipation of upcoming macro events is increasing volatility and creating an electrifying atmosphere in the cryptosphere.
US Federal Reserve interest rate decision (May 2-3)
As the Federal Reserve continues on its path toward monetary policy normalization, the potential impact of interest rate hikes on the crypto market has become the subject of intense debate.
Next week, the US central bank will gather for a central meeting where a vote on potential interest rate increases will take center stage.
The highly anticipated FOMC meeting will take place on 2-3. May, culminating in Fed Chairman Powell’s announcement of the decision on May 3. Market participants are anxiously awaiting the likely outcome – a 25 basis point rate hike – at this key FOMC event in May. Later, it is expected that the Fed will put interest rate increases on hold, starting with the FOMC meeting on 13-14. June.
An increase in interest rates can therefore plunge the crypto market significantly and strengthen the dollar. Also, the global crypto market cap may witness massive liquidation from investors.
ECB monetary policy (May 4)
The European Central Bank (ECB) plays an important role in shaping the eurozone’s economic landscape through its monetary policy and interest rate decisions. As the crypto market continues to interact with traditional financial systems, the potential influence of the ECB’s policy on digital assets becomes increasingly relevant.
As the European Central Bank gears up for its upcoming meeting on May 4, it may be forced to adopt another interest rate hike if inflation continues to follow the economic forecasts established in March.
Pending the ECB’s move, market forecasts suggest a 25 basis point increase in the 3% deposit rate at the May 4 meeting, followed by a further 25 basis point increase in mid-2023.
US Non-Farm Payroll (May 5)
The US Non-Farm Payrolls (NFP) report, a crucial indicator of the nation’s economic health, provides insight into the change in the number of employed persons, excluding the agricultural sector.
A strong NFP report usually boosts market confidence and promotes risk-taking, while a weaker-than-expected report can trigger risk aversion.
US Unemployment Rate (May 5)
In March, the US economy consistently generated jobs at a robust pace, driving the unemployment rate down to 3.5%. This trend indicates a persistent tightness in the labor market. More robust growth on May 5 could weigh on the strength of the US dollar, as better-than-expected labor market data could lead to a stronger dollar. Since cryptocurrencies are often priced in USD, fluctuations in the dollar’s value can affect crypto prices.
