A number of recent economic reports revealed cracks in the US economy’s resilience last week, with the lowest service-sector PMI reading in over two years.
This week will see key GDP and PCE inflation data released which could rattle markets even further. “PCE inflation will be the final piece to the puzzle as both PPI and CPI inflation are rebounding,” reported the Kobeissi Letter.
Analysts have also raised concerns over the effect of Trump’s sweeping federal layoffs under DOGE on the job market, adding to worries about consumption growth.
Economic Events Feb. 24 to 28
Mentions of “stagflation,” an economic condition characterized by low growth and high inflation, have become more common among economists as weaker-than-expected data could increase the likelihood of further monetary support.
Consumer confidence data will be released on Tuesday, followed by new home sales data on Wednesday.
However, the big one comes on Thursday with fourth-quarter GDP data. Economists expect to receive a confirmation of the GDP growth rate signaled by the advance estimate released last month, which was 2.3%. Higher-than-expected figures could further weigh on projected Fed rate cuts, but if they are lower, this could provide the central bank with data to support rate reductions.
Friday sees January’s Core Personal Consumption Expenditures (PCE) report, which reflects the average amount of money consumers spend monthly. Fed policymakers use this report as their primary inflation gauge.
Key Events This Week:
1. CB Consumer Confidence data – Tuesday
2. January New Home Sales data – Wednesday
3. Nvidia, $NVDA, Reports Earnings – Wednesday
4. US Q4 2024 GDP Data – Thursday
5. January PCE Inflation data – Friday
6. Total of 10 Fed Speaker Events This Week
An…
— The Kobeissi Letter (@KobeissiLetter) February 23, 2025
Wednesday will also see a Senate Banking Committee Hearing titled “Exploring Bipartisan Legislative Frameworks for Digital Assets,” which could be positive for crypto markets.
Meanwhile, AI giant Nvidia will report earnings on Wednesday, which could impact AI-related crypto assets.
Revenue reports from several crypto miners, including Riot, Marathon, Bitdeer, Terawulf, and Core Scientific, are also due this week.
Crypto Market Outlook
Crypto market capitalization has declined 2.3% over the past 24 hours to $3.28 trillion at the time of writing. However, it has remained in consolidation at current levels for the past week, largely recovering from the weekend dump caused by the Bybit hack.
Bitcoin is down marginally, having fallen below $96,000 during the Asian trading session on Monday morning. Volatility is low, and the asset has remained tightly range-bound for most of this month.
Ethereum had fully recovered from the hack news, tapping an intraday high of $2,835 in early trading on Monday, but it could not sustain that level, falling back to $2,740 at the time of writing.
