Bitcoin Hangs in Balance as Crucial US Inflation Data Looms

Bitcoin has remained steady at around $80,000 over the weekend but faces a crucial week ahead. Several key US economic events will determine how long it stays there.

The strong US jobs report from last Friday and the subsequent increase in expectations for an upcoming Fed rate hike have risk-on assets on high alert. The Federal Reserve's next move will be revealed at its FOMC meeting scheduled for September 15-16, making this week's data crucial in determining the central bank's next step.

The first major test comes on Thursday with the release of August PPI data, which measures inflation at the producer level. Economists expect headline PPI to rise 0.4% month-over-month, compared with no actual increase in July. A hotter reading could reinforce expectations that inflationary pressure is rebuilding.

The CPI report goes live on Friday and is estimated to point to inflation remaining at around 3.3%-3.4% annually. The actual results could have a significant impact on Fed rate-hike expectations, with a higher-than-expected reading strengthening the argument for another rate increase.