Investors warn of increased volatility in digital asset markets, while the International Monetary Fund (IMF) forecasts a slowdown in global economic growth.
The IMF’s July update on the World Economic Prospects, titled “Gloomy and More Uncertain,” points to “higher-than-expected inflation” and a contraction in global output as indicators of poor economic growth. what is coming right now. The report succinctly states that an economic slowdown is likely:
“Risks to the outlook are tilted overwhelmingly to the downside.”
Macroeconomic factors have been linked to the cryptocurrency bear marketprompting cryptocurrency analyst Miles Deutscher to warn his 154,000 Twitter followers to expect volatility in the markets.
He pointed out that upcoming earnings reports from Microsoft, Google, Apple and Meta, along with US gross domestic product (GDP) figures, could create more turbulence.
It’s going to be a massive week for the markets.
July 26: FOMC Meeting, Microsoft & Google Earnings
July 27: Meta Earnings
July 28: US Q2 GDP Release, Apple EarningsIncoming volatility.
— Miles Deutscher (@milesdeutscher) July 25, 2022
It’s going to be a busy week for the markets.
July 26: FOMC meeting, results from Microsoft and Google
July 27: Meta Results
Jul 28: US Q2 GDP release, Apple resultsVolatility is coming.
Crypto investors are also bracing for an interest rate hike in the United States this week. Bloomberg reported on Tuesday that The Fed is expected to raise rates by as much as 75 basis points, or 0.75%, to 2.25%, in a bid to tighten monetary policy and rein in inflation..
There are also industry watchers who expect the US to be officially in a recession when the country’s second-quarter GDP figures are released on July 28.. Investopedia defines a recession as two consecutive quarters of negative GDP growth.
Major market moving events this week for #bitcoin, #cryptoand #stocks.
– Corporate earnings reports starting
– FED Meeting (27th)
– US GDP Q2 data release (28th)White House already getting in front of what must be bad data saying it is time to change the definition! LOL!
— Lark Davis (@TheCryptoLark) July 26, 2022
The main market events this week for bitcoin, cryptocurrencies and stocks.
– Corporate earnings reports begin
– FED meeting (27)
– Publication of US GDP data for the second quarter (28)The White House is already anticipating what must be a bad data and says that it is time to change the definition! LOL!
The YouTuber of the cryptocurrency market DustyBC tweeted on Tuesday that the global slowdown coupled with potentially reduced US GDP figures could explain why the price of bitcoin (BTC) fell below $21,000..
International Monetary Fund (IMF) released its July 2022 World Economic Outlook, forecasting significant slowdown in global growth which should average 3.2% this year and 2.9% in 2023.
This + tomorrow’s FOMC meeting could explain why #BTC dipped below $21,000
— DustyBC Crypto (@TheDustyBC) July 26, 2022
The International Monetary Fund (IMF) released its July 2022 World Economic Outlook, forecasting a significant slowdown in global growth that should average 3.2% this year and 2.9% in 2023.
This and tomorrow’s FOMC meeting could explain why BTC fell below $21,000
Meanwhile, the founder of the Cosmos-based decentralized finance (DeFi) hub, Umee Brent Xu, I ask on Monday in a tweet: “A macro recession = a cryptocurrency recession?”.
Cointelegraph quoted the Material Indicators Twitter account on Monday, reporting that there is “no guarantee that any support will hold” after GDP and interest rate figures are announced.. He added that there may be several days of volatility, echoing Deutscher’s observations.
Elizabeth Gail wrote in Cointelegraph on Tuesday that bitcoin markets will likely recover as uncertainty about the current state of the economy and geopolitical tensions are resolved. However, it is not known how long that will take..
Although the economic outlook appears bleak, the IMF noted that cryptocurrency sales since May due to liquidations, bankruptcies and losses of large companies such as Celsius, Three Arrows Capital and Voyager Digital Holdings have had little impact on other financial systems.
This suggests that while the broader financial systems can have a massive effect on cryptocurrencies, the same cannot be said the other way around:
“Crypto assets have experienced a dramatic sell-off that has led to huge losses in cryptocurrency investment vehicles and caused the failure of algorithmic stablecoins and cryptocurrency hedge funds, but the spillover effects on the broader financial system have been limited so far.”
At the time of writing this article, the total capitalization of the cryptocurrency market is just over a trillion dollars, according to the TCAP index.
Disappointing earnings reports and GDP figures this week could spoil these levelsas Cointelegraph reported on Monday that investors are already starting to seek refuge in fiat in preparation for the worst.
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