Crypto Market This Week: What To Expect From US PCE Inflation, Jobs Data, GDP Growth

A Week of Economic Signals

The crypto market is entering what one outlet describes as an "information-rich" week, with a series of U.S. economic indicators expected to shape Federal Reserve policy expectations and potentially drive volatility in Bitcoin and other risk assets.

The main focus is on the Personal Consumption Expenditures (PCE) price index for July, scheduled for release on Wednesday. As the Fed's preferred inflation measure, the headline PCE is projected to rise 0.1% month-on-month, following a 0.1% decline in June, according to projections reported by CoinGape. The annual rate is expected to ease to 3.6% from 3.7%.

Core PCE, which excludes food and energy, is projected to increase 0.2% from the prior month, with the annual reading forecast at 3.3%. June's PCE inflation stood at 3.7%, with core PCE at 3.3%—both above the Fed's 2% target. A higher-than-expected July reading could reinforce expectations that interest rates will stay elevated, while a more benign print might bolster anticipation for easier policy, CoinGape reported.

The same day also brings a new GDP report, with projections calling for 1.5% annualized growth in the second quarter, down from 2.1% in the first quarter. On Thursday, weekly initial unemployment claims for the week ending Aug. 22 are forecast to hold steady at 206,000, the same as the previous week, offering another gauge of labor market conditions.

These data points come ahead of the Fed's September 16 rate decision and as markets closely watch the Jackson Hole symposium, where Fed Chair Kevin Warsh will deliver his first keynote as chair on Friday morning, according to Decrypt.

Bitcoin's Rally at a Crossroads

Bitcoin traded around $77,800 on Monday, up 22% over the past seven days, according to CoinGecko data cited by Decrypt. The recent surge has been attributed to a confluence of catalysts: Treasury Secretary Scott Bessent's announcement of a doubling of long-dated bond buybacks, President Donald Trump's meeting with crypto executives and his push for the Clarity Act, and a return of heavy buying in spot Bitcoin ETFs.

Market analysts point to a supply-demand imbalance as a key driver. Stephen Wundke, strategy and revenue director at Algoz, said exchange balances had fallen to multi-year lows, with more than 80% of Bitcoin supply held by long-term holders. He described the movement as "a textbook demonstration of supply illiquidity meeting a sudden demand shock," and noted that short positions were closed out at scale as prices pushed through $65,000 and then $70,000.

Bitget Wallet's Lacie Zhang put total crypto shorts closed at more than $4 billion over two to three days, with Bitcoin shorts alone around $2.75 billion during the initial squeeze.

James Butterfill of CoinShares called the rally "a macro story, not a crypto one," and expects the market to hold its range, with $80,000 as "an important upper boundary." Tim Sun of HashKey sees "clear resistance" near $80,000 but believes the cycle's bear market bottom has "essentially taken shape." Wundke identified the next major obstacle at $82,000, suggesting that clearing it could open a path toward $95,000.

Jackson Hole in Focus

The Jackson Hole symposium, running from Thursday to Saturday under the theme "Financial Innovation: Implications for Payments and Policy," takes on added significance with Warsh's first keynote. Warsh took office in May, succeeding Jerome Powell, and has prioritized changing how the Fed communicates, dedicating one of five internal task forces to the question. Asked about the keynote after July's Fed meeting—where the committee held rates at 3.50% to 3.75% on a 9-3 vote, with three regional presidents dissenting in favor of a hike—Warsh said it was "a blank piece of paper right now," as reported by Decrypt.

Market expectations for the upcoming Fed decision show a notable shift. CME's FedWatch tool puts the chance of a rate hike at 38.4%, with 61.6% for no change and nothing priced for a cut. A month ago, the hike probability stood at 82%. On prediction market Myriad—owned by Decrypt's parent company Dastan—traders price a 25 basis point increase at 32% against 71% for no change.

As the week unfolds, the interplay between economic data, Fed signals, and crypto market dynamics will likely determine whether Bitcoin's rally can sustain its momentum or faces a test at key resistance levels.