- The US will release the latest inflation data on Tuesday.
- The Federal Reserve will make its final decision of the year on Wednesday.
- The SNB and ECB will deliver their decisions on Thursday.
Bitcoin, the US dollar index (DXY), and the Nasdaq 100 will be in the spotlight this week as the US publishes the latest inflation data. These numbers will be followed by the upcoming Federal Reserve, European Central Bank (ECB), and Swiss National Bank (SNB) decisions.
Bitcoin price has been in a strong uptrend for three main reasons. First, there are signs that the Federal Reserve is set to start cutting interest rates in the coming months since it is succeeding to engineer a soft landing for the economy.
Second, investors expect the Securities and Exchange Commission (SEC) will approve the spot Bitcoin ETF by companies like Blackrock, Invesco, Franklin Templeton, and Ark Invest in the coming months.
Third, Bitcoin has jumped as it becomes part of the so-called balanced portfolio. This is a situation where institutional investors are allocating Bitcoin to their portfolios because of its historic performance.
Meanwhile, the US dollar index (DXY) has pulled back in the past few weeks. It retreated to $104.10, which was lower than the year-to-date high of $107.35. Its 50-day and 100-day moving averages have made a bearish crossover, pointing to more downside.
The Nasdaq 100 index, which tracks the biggest technology companies, rose to $16,085 and is hovering near its highest point this year. It has jumped by over 40% in 2023, beating the S&P 500 and the Dow Jones indices.
The US dollar index, Nasdaq 100, and Bitcoin will be in focus this week as the US publishes the latest inflation data. These numbers are set to confirm that the country’s inflation continued slipping in November, helped by durable goods. Gasoline prices have crashed to the lowest point in two years.
The other key event that will move the three assets will be the last Federal Reserve decision of the year. Economists believe that the Fed will leave rates unchanged between 5.25% and 5.50%. Therefore, the key mover will be the bank’s guidance on future interest rates.
The bank will likely deliver a hawkish pause in which it hints that it will hike rates in 2024. In a recent statement, Jerome Powell warned that investors were getting ahead of themselves in anticipating rate cuts in 2024.
There will be other important rate decisions this week as the Swiss National Bank and European Central Banks will deliver their statements. In the past, these decisions tends to have little to no impact on the three assets.
