CPI, PPI, & Ethereum Dencun Upgrade: What To Expect From Crypto Market This Week?

The crypto market braces for a pivotal week ahead, marked by significant events that could steer investor sentiment and market trajectory. With Bitcoin recently hitting an all-time high, anticipation mounts as key inflation data and various developments unfold. These events, ranging from Federal Reserve announcements to blockchain upgrades, are poised to influence market dynamics in the days to come.

Meanwhile, the inflation data holds weight after Federal Reserve Chair Jerome Powell’s testimony signals potential rate cuts, but the timing remains uncertain, raising discussions in the crypto market. Powell’s remarks to the Senate Banking Committee suggest rate cuts may come soon, pending sustained inflation at 2%.

Market expectations shift from early-year projections of multiple cuts to a forecast of the first cut in June, totaling a percentage point reduction by 2024’s end. Besides, Powell emphasizes the need to avoid recession, indicating a cautious approach to policy normalization as the economy recovers.

Key Events To Watch This Week

U.S. Consumer Price Index (CPI) Data

The U.S. Consumer Price Index (CPI) data for February, crucial for the Federal Reserve’s inflation assessment, is slated for release on March 12. Notably, the crypto market investors await insights into future Fed policy as annual CPI inflation dipped to 3.1% in January, slightly exceeding forecasts.

In addition, annual core inflation in January remained steady at 3.9%, above expectations. Although January saw a cooling trend from December, CPI remains above the Fed’s 2% target, signaling continued inflationary pressure in the economy.

U.S. Producer Price Index (PPI) Data

On Thursday, March 14, the U.S. Producer Price Index (PPI) will be released, influencing the Fed’s potential rate-cut decisions. In January, PPI rose 0.3%, marking the largest increase since August 2023.

On the other hand, the Core PPI, excluding food and energy, also saw a 0.5% uptick, surpassing Wall Street’s expectations. Considering that, the February CPI and PPI data will be closely watched by crypto market enthusiasts for the Fed’s potential move with their upcoming rate-cut plans.

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Ethereum Dencun Upgrade

The crypto market investors are optimistic as Ethereum’s eagerly anticipated Dencun upgrade arrives on March 13. The upgrade promises reduced transaction costs on layer 2 networks, expected to boost activity and attract mainstream interest.

With eyes on a potential Ethereum price rally post-upgrade, anticipation is high among crypto market investors amid looming uncertainties in the market. Besides, the optimism over the Ethereum price also surges amid anticipation of Ethereum ETF approval by the SEC.

Federal Reserve’s BTFP Expiration

Crypto market investor anxiety brews as March 2024 marks the end of the Federal Reserve’s BTFP, a critical scheme to stabilize the US banking sector. Initiated in response to bank failures, its expiration on March 12 raises concerns about liquidity impact and potential effects on cryptocurrency prices.

Notably, the program, launched amid pandemic uncertainties, aimed to counteract the fallout from bank failures and interest rate hikes, signaling a pivotal moment for market stability.

FTX Customer & Non-Customer Creditors’ Meeting

On March 15, FTX Digital convenes its inaugural meeting with both customer and non-customer creditors, stirring anticipation across the crypto market. The deliberations’ results hold significance for the crypto sphere, potentially influencing investor sentiment and market steadiness.

Bottom line

In a week filled with pivotal developments, the crypto market braces for the impact of crucial inflation data, poised to influence the Federal Reserve’s interest rate decisions. Amid this anticipation, optimism surrounds the imminent Ethereum Dencun upgrade, expected to enhance scalability and reduce transaction costs.

Besides, market participants remain vigilant as liquidation concerns intensify, with the upcoming expiration of the Fed’s BTFP. As investors navigate these dynamic landscapes, attention is drawn to the intersection of macroeconomic indicators, technological advancements, and regulatory shifts, shaping the trajectory of the crypto market in the weeks to come.

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