Bitcoin Barely Budges as Weak US Jobs Data Cuts Fed Hike Odds to 44%

Bitcoin (BTC) saw a modest 0.7% increase to $65,300 shortly after the U.S. Bureau of Labor Statistics reported a decline of 23,000 non-farm payrolls in July, far below the forecasted gain of 83,000. The data, released on Friday, prompted traders to cut the odds of a September Federal Reserve rate hike to 44%, according to the CME FedWatch Tool. Dow futures rose nearly 200 points as Treasury yields fell.

Revisions to previous months deepened the slowdown: May payrolls were revised down by 66,000 to 63,000, and June by 37,000 to 20,000, leaving the two months a combined 103,000 weaker than earlier reported. Average monthly job creation over the past year now stands at 34,000. Sectors such as local government education, leisure and hospitality, retail trade, and financial activities lost jobs, while health care and construction added positions.

Average hourly earnings rose 2 cents to $37.62, but annual wage growth slowed to 3.2%, below the 3.5% forecast and the weakest since May 2021. The unemployment rate edged down to 4.1% as the labor force shrank by 264,000 and participation fell to 61.4%.

The Federal Open Market Committee held its benchmark rate at 3.50% to 3.75% in July, with three regional presidents favoring a quarter-point increase. Inflation remains above the 2% target. Chris Zaccarelli, chief investment officer at Northlight Asset Management, noted that the report shifts focus from inflation to labor market risks.

Bitcoin’s reaction was muted compared to two months ago, when stronger-than-expected labor data triggered a hawkish repricing, sending BTC to $59,100 and causing $1.7 billion in liquidations. Digital asset funds had previously bled $454 million in a single week during a period of fading rate expectations. The latest data suggests that while rate hike odds have fallen, Bitcoin’s price response remains restrained.

Source: https://cryptopotato.com/bitcoin-barely-budges-as-weak-us-jobs-data-cuts-fed-hike-odds-to-44/