Bitcoin Shrugs Off Soft US Jobs Report as September Fed Hike Odds Slide to 44%

Bitcoin showed only a muted response to a weaker-than-expected US jobs report on Friday, even as markets sharply pared back expectations for another Federal Reserve rate increase. After the Bureau of Labor Statistics released July nonfarm payrolls at 8:30 a.m. ET, traders cut the implied probability of a September hike to 44%, according to CME Group's FedWatch tool. The odds for October stood at 58.3% following the data. Dow futures rose by nearly 200 points as Treasury yields declined. Nonfarm payrolls unexpectedly fell by about 23,000 in July, versus the Dow Jones consensus forecast for an 83,000 gain, CNBC reported. Bitcoin (BTC) rose about 0.7% in the hour after the release, briefly reaching $65,300. It had traded near $64,500 in the 30 minutes beforehand, CoinGecko data showed. Revisions added to the sense of cooling. The BLS cut May payroll growth by 66,000 to 63,000 and June by 37,000 to 20,000, making the two months a combined 103,000 weaker than previously reported. Average monthly job creation over the past year is now estimated at 34,000. Job losses were led by local government education (-50,000), leisure and hospitality (-40,000), retail trade (-19,000), and financial activities (-14,000). Health care added 22,000, below its 36,000 monthly average, while construction also added 22,000. Private payrolls increased by 30,000, while government employment fell by 53,000. Average hourly earnings rose by $0.02 to $37.62. Year-over-year wage growth slowed to 3.2%, below the 3.5% forecast and the weakest reading since May 2021. The unemployment rate ticked down to 4.1% as the labor force declined by 264,000 and the participation rate slipped to 61.4%. The report lands as investors reassess the Fed's next move. The Federal Open Market Committee held its benchmark rate at 3.50% to 3.75% on July 29 in a 9-to-3 vote, with three regional bank presidents favoring a quarter-point increase. Inflation remains above the central bank's 2% target. "This morning's report is a game changer in the sense that all of the recent focus has been on inflation and this report highlights the risks that are embedded in the labor market as well," said Chris Zaccarelli, chief investment officer at Northlight Asset Management. Crypto markets have reacted far more aggressively to upside jobs surprises in recent months. Two months ago, stronger-than-expected labor data triggered a hawkish repricing that sent Bitcoin down to $59,100, marking a 20% weekly drop alongside $1.7 billion in liquidations. In another earlier period of easing rate expectations, digital asset funds saw $454 million of outflows in a single week. The post Bitcoin Barely Budges as Weak US Jobs Data Cuts Fed Hike Odds to 44% appeared first on CryptoPotato.