Crypto Market Braces for Volatility as Powell Testifies, Jobless Claims, PCE Inflation Loom

This week is set to be a critical period for the crypto market, with three significant U.S. economic indicators poised to influence Bitcoin and other major cryptocurrencies. These indicators include Federal Reserve Chair Jerome Powell’s testimony, jobless claims data, and the Personal Consumption Expenditures (PCE) inflation index. The outcomes of these events could drive substantial volatility in the crypto market.

The current sentiment in the crypto market is bearish, with a 2.6% decline in the total market cap over the past 24 hours. Major cryptocurrencies have experienced notable drops, including Bitcoin down 4.9%, Ethereum down 14%, and Solana down 14.7%. The U.S. Economic Surprise Index, which measures whether economic data beats or misses expectations, is at its most negative point in 2025, indicating growing uncertainty and reduced risk appetite, which could impact crypto demand.

On June 24, Federal Reserve Chair Jerome Powell will testify before Congress on U.S. economic policy, employment, and inflation. His remarks could have a direct impact on crypto prices. A hawkish tone, signaling tight monetary policy, may hurt Bitcoin and boost the dollar. Conversely, a dovish tone, signaling easing policy, may support Bitcoin and weaken the dollar. A neutral stance could cause short-term volatility. In the past 14 days, Bitcoin has dropped 3.5%, including a 0.8% decline in the last 24 hours, now hovering around $101,886. Geopolitical concerns, such as Iran's threat to block the Strait of Hormuz, could also influence global markets and Federal Reserve decisions.

Last week, initial U.S. jobless claims declined from 250,000 to 245,000. This week, forecasts expect a slight increase to 247,000. Higher jobless claims may signal economic weakness and trigger a positive reaction in Bitcoin, while lower-than-expected claims may indicate economic strength and pressure risk assets like crypto.

The PCE Price Index, due on June 27, is the Fed’s key inflation gauge. In April, the PCE fell from 2.3% to 2.1%. The current consensus expects a rise back to 2.3%, while some analysts estimate a smaller rise to 2.2%. If PCE inflation beats expectations (above 2.3%), the Fed may delay rate cuts, strengthening the U.S. dollar and reducing investor interest in Bitcoin, leading to a further price drop.

This week’s market direction will depend on how these three factors unfold. Powell’s tone, jobless claims, and inflation figures will decide whether Bitcoin can regain momentum or face another sell-off. Volatility is almost guaranteed, and the crypto market is bracing for significant movements based on these key economic indicators.