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Crypto Markets Face Another Volatile Week Amid Economic Uncertainty
The cryptocurrency market was somewhat stable during the weekend, however, it began to slide to the downside the next morning, if a volatile week started.
This week, the markets responded in a frenzied manner in response to U.S. President Trump’s abrupt announcement of tariffs. However, they did find some reassurance after the inflation figures revealed that the Consumer Price Index (CPI) was lower than expected. Still, there were concerns in the meantime as it was reported that the Consumer Sentiment Index continued its downward trend for three months, reaching the lowest point since November 2022 amidst mounting anxiety about the recession.
Key Economic Events (March 17-21)
This week will bring several important economic news that may affect financial markets, such as crypto.
- Monday: The February Retail Sales Report will offer insights into trends in consumer spending as a major measure of health in the economy as well as the inflation pressure.
- Tuesday: The industrial production numbers that include mining, manufacturing utilities, as well as housing start-ups, will be announced, even though they generally have less of an impact on the effect on markets.
- Wednesday/Thursday: The U.S. Federal Reserve’s interest rate decision for the second time in 2025 is set to take place in the spotlight. Fed officials will hold rates stable at 4.25%-4.5 percent as they evaluate the effect of Donald Trump’s policies on economics. It is estimated that the CME Fed Watch tool currently gives a 99 percent chance that rates will stay the same.
Andrzej Skiba, a director at RBC Global Asset Management warned that more tariffs are coming, and said, “This will be inflationary, and the Fed probably won’t be able to cut rates in this environment.”
According to CryptoPotato, the Trump strategy to take advantage of “short-term pain” appears aimed towards temporarily weakening markets to get a more long-term decrease in interest rates and inflation.
Crypto Market Update
The total market value of crypto is down 3.3 percent over the day and is now $2.8 trillion, as the losses increased on Monday’s Asian market session.
- Bitcoin (BTC): The price fell from $83,000 to just $82,000 before rebounding up to $83,000. It was a decline of 11% in the past two weeks.
- Ethereum (ETH): The cryptocurrency ETH is struggling to gain momentum after falling to $1,900 and showing no evidence of improvement.
- Altcoins: The majority of important altcoins are in the red. Solana (SOL) as well as Pi Network (PI) seeing more severe losses. However, Shiba Inu (SHIB) and Polkadot (DOT) had small gains.
With macroeconomic uncertainties looming the crypto market is bracing for more volatility in the future.
