- Several important events await us in the coming days;
- Crypto investors should keep an eye on them to understand market sentiment.
The calendar of economic events for the next week (06/03/2023-12/03/2023) is full of interesting moments. They will certainly affect financial markets, including the cryptocurrency market. We expect, among other things, a meeting of central banks on monetary policy, financial results of leading listed companies, labor market data and statistics from the Far East.
Brief overview of the current situation
Cryptocurrencies started the working week in the red: BTC, ETH and the other 10 TOP coins traded cheaper than a day ago.
We still see fears around the Silvergate cryptobank, the bitcoin dump due to the Mt.Gox exchange, the persecution of Binance and other key players. Weak ISM (PMI) data also contributed to the decline.
Together, this fear overcame even the bullish growth that was observed in the US market on Friday. That is, stocks rose, and cryptocurrencies remained in place (which happens not so often).
Let’s see what will affect the market this week.
Monday. The Beginning of Change in China
The annual session of the Chinese Parliament started yesterday. It will last until March 20. There will be made declarations on the future strategy of economic development and the country’s GDP. The government of the outgoing Prime Minister Li Keqiang will also present its report on the work.
Also coming out today:
- Swiss inflation data.
- Sentix Investor Sentiment Index.
- The final data on orders for durable goods in the US.
Tuesday. Powell’s speech
Tomorrow, Fed Chairman Jerome Powell will talk about the US economic outlook. He will testify before the Senate Banking Committee. The official presents a semi-annual report on the monetary policy of his department.
Investors are waiting for a new understanding of the Fed’s monetary policy strategy. In particular, their plans for March 22, when a decision on the interest rate will be made.
Any hints from Powell to change the rhetoric should move the markets. With inflation rising again, the Fed chief is likely to continue to view recession as an inevitable part of the new reality.
Also on Tuesday we are waiting for:
- The decision of the authorities of the Reserve Bank of Australia on interest rates (an increase of 25 bp to 3.6% is expected).
- Beginning of the two-day meeting of the Monetary Policy Council (MPC).
Wednesday. Jerome Powell conference and JOLT report
On Wednesday, Jerome Powell will give another speech, this time to the House Financial Services Committee.
In parallel, the JOLTS jobs report for February from the Bureau of Labor Statistics will be released. The current forecast is 10.60 million vacancies (against 11.01 million people over the past period).
If the number of vacancies is lower than expected, this indicates a slowdown in economic growth (another proof of the economic recession in the US). A weak JOLTS report could crash US stock prices (and prices in the cryptocurrency market).
And the second option. If American companies create more new jobs than forecast, they will support the strength of the US economy. This means that the market may revive, as it did on February 1st.
Thursday. China Foreign Trade Data
March 9 China publishes new data on inflation. The forecast is an increase of 0.1-0.8%. If consumer prices in China turn out to be higher than forecasts, then the local central bank may revise its loose monetary policy. For industrial inflation, analysts expect a decline of -0.5 p.p. China is the second most important economy in the world, so it is important to keep an eye on its condition. Moreover, in light of the almost threat of a Cold War with the United States
Also on Thursday we expect the following numbers:
- Announcement of the monetary policy decision of the European Central Bank (ECB).
- Retail sales data in Australia.
Friday. US jobs data
On March 10, the US will present its February employment report. This is the last report before the upcoming Fed meeting on March 21-22. It is important that before this, the January data caught the market by surprise – they were much higher than predicted. This prompted investors to reconsider their interest rate expectations. So Friday’s metrics take on special significance.
So, the key here will be employment in the non-farm sector (NFP, “non-farm payrolls”). And here’s why it’s important. In January, 517,000 new jobs were created. Investors now expect to see 200,000 in the reports (that is, much lower). If the forecast comes true or even lower, then the theory of experts that the strong January numbers were distorted due to the re-employment of many employees in the public sector will be confirmed. Weak data on the labor market can subsequently have a negative impact on stock markets and crypto.
If analysts’ expectations are not justified again (that is, there will be more jobs), we can expect positive price dynamics in the financial markets.
Also on Friday, the latest data on the unemployment rate will be released. It is expected to remain at its lowest level in more than five decades (3.4%).
If the unemployment rate falls again to record lows, then the dollar should eventually continue to rise. This will become a new obstacle for the Bitcoin exchange rate.
In addition, we continue to monitor news that directly relates to the crypto market. Read the latest information on our website and Telegram channel.