Key US Economic Events That Could Impact the Crypto Market in September

Why Economic Data Matters to Crypto Investors 

Economic data from the US often influences how investors feel about the economy. When traditional markets show strength, investors may become more confident. This can lead to a higher appetite for risk and an increased interest in alternative assets, such as cryptocurrencies. Conversely, negative economic data can make investors cautious, potentially pulling back from riskier investments. 

US Economic Events to Watch in September 

Bitcoin (BTC) has been under pressure recently, slipping further away from the $60,000 level. This performance has remained sluggish, even though there have been positive signs for the crypto market. These include growing institutional adoption and talks of a more favorable regulatory environment. There is also speculation about potential rate cuts by the Federal Reserve, but these have not yet helped BTC’s price. 

Currently, Bitcoin is trading over 20% below its recent all-time high of nearly $73,500. This drop happened more than five months ago, and September has historically been a challenging month for Bitcoin. Crypto market participants are now focusing on several key events in the US, hoping for better outcomes. 

Non-Farm Payrolls and Unemployment Rates 

One of the most closely watched reports this month will be the US Non-Farm Payrolls (NFP). This report provides important data on job creation and the unemployment rate. In July, the report showed weaker-than-expected job growth, with only 114,000 jobs added. For August, the forecast is a bit higher, with expectations of around 162,000 jobs. 

If the August NFP figures are strong and show a decline in the unemployment rate, this could be a sign of a robust economy. A healthy job market can boost investor confidence, potentially benefiting cryptocurrencies. Employment reports like the NFP can significantly impact market sentiment and risk appetite, indirectly affecting Bitcoin and the broader crypto market. 

Before the NFP report, investors will look at the Job Openings and Labor Turnover Survey (JOLTS) data, released on Wednesday. For July, there is a median forecast of 8.1 million job openings, slightly down from 8.18 million. If the data meets or exceeds expectations, it could signal economic growth and potential wage increases. 

Another important employment report is the ADP National Employment Report, which provides a snapshot of private sector employment. If this report shows job creation exceeding the previous 122,000 jobs added in July, it would indicate strong economic growth. 

US Consumer Price Index (CPI) 

The US Consumer Price Index (CPI) for August is another crucial economic indicator. Scheduled for release on September 11, the CPI measures inflation by tracking price changes in consumer goods and services. In July, the CPI inflation rate was 2.9%, slightly lower than the 3% recorded in June. 

The Federal Reserve aims for a 2% inflation rate. If the August CPI data shows a decrease below 2.9%, it could indicate that inflation is slowing down. This might reduce the pressure on the Fed to keep interest rates high. Lower inflation rates can be bullish for cryptocurrencies as they often benefit from a looser monetary policy. 

Ahead of the CPI release, speeches by New York Fed President John C. Williams and Fed Governor Christopher Waller will be closely monitored. Both officials have suggested a possible shift towards a more relaxed monetary policy if inflation continues to ease and the labor market stabilizes. If their speeches show confidence in the disinflationary trend, it could positively influence the crypto market. 

US Producer Price Index (PPI) 

The US Producer Price Index (PPI) data, released a day after the CPI, is also vital. In July, the PPI showed significant easing, with the inflation rate decreasing to 2.2% year-on-year (YoY). This was below the expected 2.3% and down from the previous period’s revised 2.7%. 

Similarly, Core PPI inflation, which excludes food and energy prices, dropped to 2.4% YoY in July. This was also below the forecast of 2.7% and lower than the previous 3.0%. If the August PPI data, set for release on September 12, shows continued declines, it could boost investor confidence. Lower inflationary pressure can increase risk appetite, favoring assets like Bitcoin and other cryptocurrencies. 

Federal Reserve Interest Rate Decision 

The Federal Reserve’s interest rate decision on September 18 is one of the most anticipated events of the month. In its previous meeting, the Federal Open Market Committee (FOMC) kept interest rates unchanged, with the benchmark rate between 5.25% and 5.50%. 

However, Fed Chair Jerome Powell recently expressed increased confidence that inflation is on a sustainable path towards the Fed’s 2% target. Any indication of a potential rate cut or a continuation of the current rate could have significant effects on the crypto market. 

Summary of Key US Economic Events in September 

Investors and market participants should stay informed and watch these events closely. The outcomes could play a crucial role in shaping the crypto market in September and beyond.