This Friday, September 27, the US PCE will be published, something that could bring volatility to the markets, including bitcoin (BTC). The report will be released at 8:30 AM New York time (12:30 PM UTC time).
The PCE (personal consumption expenditure price index) measures changes in the prices of goods and services consumed by households. In this way, provides a more accurate view of inflation than the CPI (consumer price index), which measures a number of specific elements.
In addition, the PCE will also be published core (core), which excludes two volatile components (food and energy), giving a more accurate perspective. For this reason, this measure is monitored by the Federal Reserve (Fed), the United States Central Bank, to define monetary policy.
Stock prices and bitcoin are often impacted by inflation reportsso it is key for traders to take this into consideration. In addition, markets are being influenced by data that show US economic development in the face of risks raised by the cooling of the labor market.
Therefore, a volatile day for the market is to be expected, either down or up depending on how the result is viewed. According to the Investing survey, the annual PCE is expected to fall from 2.5% to 2.3%, as shown below.
Bitcoin could react to an improvement in the PCE
“A PCE of 2.3% is optimistic,” consider Bitcoin and cryptocurrency market trader Satoshi Flipper said: “If this continues, it will only show a further moderation of inflation, which now justifies further interest rate cuts,” he warns.
Nevertheless, There is no consensus among specialists on a reduction in this inflation measure.which could be a volatile day for the markets. According to the economists of Bank of America, the annual PCE will rise to 2.7%. Meanwhile, according to data from TradingEconomicsthe underlying measure will rise from 2.6% to 2.7%.
The Fed last week cut interest rates for the first time in more than four years, beginning a period of reductions. This monetary policy increases liquidity, enabling greater demand in the markets. However, it also reflects weakness in the economy, so its development will be crucial for assets such as bitcoin.
