2025 Week 1 encryption Trader Economic Calendar

After experiencing a year of economic ups and downs and Intrerest RateFluctuation, traders are looking forward to finding a clearer direction from the upcoming economic data. In particular, the market will follow whether the Federal Reserve will continue its cautious monetary policy. Any unexpected results in employment and inflation data could trigger market Fluctuation and affect capital flows - including the choice to invest in digital assets.

2025 Early Economic Situation: Interpretation of Main Trends

Central Bank Policy: Tightening First, Then Observing

Fed's dynamics | In 2024, the Fed lowered interest rates several times and the latest adjustment of the Interest Rate to a range of 4.25% - 4.5%. Despite the drop in inflation levels from the peak, it is still above the target level of 2%. According to the latest forecast, the Fed may lower interest rates twice in 2025, totaling 50 basis points. Impact on cryptocurrencies: Higher interest rates will increase borrowing costs and may reduce market interest in high-risk assets, including cryptocurrencies. However, if future data continues to show a decline in inflation, the market may welcome a more accommodative environment.

Image Credit: Yahoo Finance

ECB's Dynamics | In 2024, the European Central Bank still maintains a hawkish stance, continuing its high Interest Rate policy to tackle stubborn inflation issues. If future inflation data does not significantly improve, the ECB is likely to continue tightening its policy, putting pressure on risk assets including cryptocurrencies.

Inflation: still the focus

Global inflation, although showing signs of easing, remains above the target levels of major central banks. In the US, core inflation remains stubborn, driven by wage growth and housing costs. In Europe, the slower-than-expected decline in inflation makes the market more cautious about the possibility of further interest rate hikes by the European Central Bank. Impact on cryptocurrencies: High inflation may lead more people to view cryptocurrencies as a 'store of value' tool, especially assets like Bitcoin. However, on the other hand, the tightening policies adopted to combat inflation may reduce market liquidity, which could limit the upside potential of the crypto market.

Global Economic Growth: Moderate but Steady

United States | According to the latest data forecast, the economic growth rate in the United States in 2025 is expected to be around 2.1%, slightly higher than the previous 2%. Although this growth rate is steady, it is not enough to drive a comprehensive market rebound. Europe | Due to high inflation and geopolitical risks, the economic outlook in Europe remains weak. China | China is adopting targeted policies to stimulate the economy, which helps support global demand. However, the speed of recovery still has some uncertainties.

Image Credit: Goldman Sachs

Geopolitical Risk: An Unignorable Variable

The current situation: The trade and technological friction between the United States and China remains tense. The Ukraine war and the Middle East conflict continue to put pressure on the energy market and the global supply chain. Impact on the crypto market: In times of heightened tension, cryptocurrencies such as Bitcoin are sometimes seen as safe-haven assets. However, in the short term, the performance of the cryptocurrency market often fluctuates in sync with other risk assets.

Image Credit: Visual Capitalist

Unique Driving Force of the Cryptocurrency Market

Technological breakthroughs｜The Ethereum upgrade, new DeFi trends, and the combination of artificial intelligence and blockchain could all become catalysts for the market. Institutional participation｜As regulations gradually become clear, traditional financial institutions are increasingly interested in cryptocurrencies, which will bring long-term growth to the market. Central Bank Digital Currency (CBDC)｜Many central banks are accelerating the launch of digital currencies, which may promote the popularization of cryptocurrencies, but may also pose certain competition to existing digital assets.

Key Data Release (December 31, 2024 - January 10, 2025)

Week 1: December 31, 2024 - January 3, 2025

China Manufacturing PMI

Forecast value: 51.8

Why is it important: PMI is an important indicator for measuring the activity level of the manufacturing industry. A reading above 50 indicates expansion, while a reading below 50 indicates contraction. Caixin PMI pays more attention to the performance of private enterprises and is one of the leading indicators of the Chinese economy.

Potential impact: If the data performs well, it may boost market confidence in the global economy, and this optimism may also transmit to the cryptocurrency market.

German unemployment change

Forecast: +10K

Why it's important: Germany is the "cornerstone" of the European economy, and the stability of the labor market directly affects the economic confidence of the euro area.

Potential impact: If the number of unemployed is lower than expected, it may enhance investors' confidence in the European market and thus boost the risk appetite of the cryptocurrency market.

US ISM Manufacturing PMI

Forecast Value: 48.5

Why is it important: A reading below 50 indicates contraction in manufacturing activity, which is typically seen as a signal of economic weakness.

Potential Impact: If the data is weaker than expected, the market may be concerned about a slowdown in the US economy, which could put pressure on risk assets, including cryptocurrencies.

Week 2: January 6, 2025 - January 10, 2025

German inflation rate (December)

Forecast: 2.0% YoY

Why it matters: German inflation data will confirm whether the European Central Bank faces further pressure to raise interest rates. Lower inflation may support a more dovish policy stance, favoring risk assets, including cryptocurrencies.

Potential impact: The market will observe whether inflation shows signs of cooling down.

French and Italian inflation (December), Eurozone unemployment rate (November)

Forecast: France 1.6%, Italy 2.3%

Eurozone unemployment rate: 6.3%

Why it matters: The core country's declining inflation indicates weakened price pressure, while a stable unemployment rate demonstrates economic resilience. These factors collectively shape the policy expectations of the European Central Bank.

Potential impact: If the inflation rate drops, it may boost investor confidence; but data exceeding expectations may trigger concerns about tightening policy.

FOMC Meeting Minutes (December) in the United States

Why it matters: Traders will carefully read the minutes to understand the Fed's policy outlook for 2025, especially the possibility of adjustments in Intrerest Rates.

Potential Impact: Any change in policy orientation may cause short-term fluctuation.

Image Credit: Trading Economics

Trade balance and labor market data

Trade data

Australia: forecast to be A$5.953B

Germany: forecast at €13.4B

Why it's important: A strong trade surplus indicates a healthy economy, which may have a positive impact on the sentiment of the cryptocurrency market.

Potential impact: Positive trade data may boost market risk sentiment and drive up cryptocurrency prices.

Labor market data

Canadian Unemployment Rate (December): Forecast 6.8%

U.S. non-farm payrolls data (December): forecasted 220K

US Unemployment Rate (December): Predicted 4.3%

Why it matters: Employment data directly affects central bank decisions. If the data is weak, it may strengthen market expectations of loose monetary policy, which is positive for the cryptocurrency market.

Potential impact: Non-farm employment exceeding expectations may temporarily boost the US dollar, but soft data may enhance market expectations of easing, thus driving cryptocurrency prices.

Image Credit: Trading Economics

University of Michigan Consumer Sentiment Index (Preliminary)

Forecast: 75

Why it matters: Consumer confidence reflects expectations for the economy. Higher confidence may encourage more risk-taking, while weaker confidence may lead to more cautious market sentiment.

Potential Impact: The consistency of consumer confidence and employment data will be a focus of investor follow.

Strategic focus of cryptocurrency traders

follow Chinese economic trends

If China's manufacturing PMI data is better than expected, it may boost global market sentiment and bring funds into the cryptocurrency market.

However, if the data performance is poor, it may weaken the market's risk appetite and put pressure on crypto assets.

Pay attention to economic indicators in the Euro zone.

German employment data and inflation rates in Germany, France, and Italy will affect the policy direction of the European Central Bank.

Dovish policy signals may push up market risk sentiment, benefiting risk assets including cryptocurrencies.

follow the Fed signal

The minutes of the FOMC meeting, as well as the ISM PMI and non-farm employment data from the Federal Reserve, will be the focus of the market's attention.

If the Fed hints at a rate cut, it may bring upward opportunities for the cryptocurrency market; while hawkish signals may cause short-term Fluctuation in the market.

Interpreting trade data

Positive trade data from Germany and Australia typically reflects strong global economic demand.

The rising risk appetite in the market environment may inject more confidence into the cryptocurrency market.

Consumer and labor market confidence

Strong North American labor data and consumer confidence help boost market sentiment, supporting the performance of crypto assets.

If the data is weak, it may trigger a market adjustment in the short term, but it may pave the way for future loose monetary policy, creating long-term benefits for the cryptocurrency market.

Manage market Fluctuation性

Intensive data releases may lead to significant market fluctuations.

It is recommended to use stop-loss orders to control risks, diversify investment portfolios to reduce exposure to individual assets, and closely follow market liquidity changes to ensure stable trading.

Global Risk and Market Sentiment Analysis

Geopolitical risk

Current hot topics: the US-China trade and technology conflict, the Ukraine war, and the tense situation in the Middle East are still the main uncertainty factors, especially affecting the energy market.

Impact on the cryptocurrency market: During periods of increased geopolitical tensions, cryptocurrencies such as Bitcoin are sometimes seen as a safe haven asset. However, when overall market risk aversion rises, cryptocurrencies may decline along with other high-risk assets.

Consumer behavior

Why it matters: Consumer confidence and holiday spending data are important indicators of economic vitality. If consumer confidence is low, it could impact the willingness of retail investors to enter the cryptocurrency market.

Indicators to follow: Michigan Consumer Confidence Index, and whether it is consistent with employment and inflation trends.

Regulation and Central Bank Digital Currencies (CBDCs)

Current situation: Major economies are accelerating the establishment of regulatory frameworks for cryptocurrencies, which may enhance institutional investors' trust in crypto assets. At the same time, multiple countries are testing or launching central bank digital currencies (CBDCs).

Impact on the cryptocurrency market: clearer regulatory policies may attract more funds into the market, while unclear or overly strict regulations may undermine market confidence.

Market Liquidity

Influencing factors: central bank policies, as well as special events within the crypto market (such as token unlocks and blockchain protocol upgrades).

Importance: Insufficient liquidity will exacerbate market fluctuations, while sufficient liquidity can provide support to the market and help prices rise.

Energy and Commodities

Why it matters: The Fluctuation of oil and gas prices directly affects the costs of consumers and businesses, thereby influencing the trend of inflation and Intrerest Rate. At the same time, higher energy prices may also affect the profitability of Bitcoin mining.

Market expectations for early 2025

The next move of the Federal Reserve

Status: After multiple rate cuts by the Federal Reserve in 2024, it is expected that there may only be two rate cuts in 2025, totaling 50 basis points. The minutes of the December FOMC meeting will further clarify its policy direction.

The impact on the crypto market: If the Fed releases a dovish signal, it may boost market risk appetite, and crypto assets are expected to rise. But if the tone of the minutes is hawkish, it may trigger short-term selling.

Inflation trend

Current situation: Inflation data from Germany and the Eurozone will reveal whether there is any easing of price pressure.

Impact on the cryptocurrency market: If the decline in inflation exceeds expectations, market expectations for loose monetary policy may increase, benefiting risk assets including cryptocurrencies.

Resilience of the labor market

Current situation: The US non-farm employment data and unemployment rate will reveal the labor market conditions, while Canada's data provides an additional perspective on the North American economy.

The impact on the crypto market: Strong employment data may boost the dollar in the short term, putting pressure on cryptocurrencies. However, if the data is weak, it may increase market expectations of loose policies, providing long-term benefits for crypto assets.

China's economic recovery

Current situation: China's PMI data will reflect whether fiscal policy has effectively stimulated economic growth.

Impact on the Crypto Market: If the Chinese economy performs strongly, it will boost global market confidence and demand for commodities, and this optimism may also extend to the crypto market.

Internal driving force of the crypto market

Current situation: Technological advancements, increased institutional adoption, and a clearer regulatory environment are shaping the future of the cryptocurrency market.

The impact on the crypto market: Even as the macroeconomy faces challenges, upgrades to Ethereum, the revival of DeFi, and the development of AI-driven projects could still bring growth opportunities to the market independent of traditional economic cycles.