Bitcoin and other major cryptocurrencies oscillated on Friday after a weaker-than-expected U.S. jobs report raised the odds of Federal Reserve rate cuts.
The U.S. Bureau of Labor Statistics said nonfarm payrolls rose by 22,000 in August — far below economists’ forecast of 75,000 — while the unemployment rate edged up to 4.3% from 4.2%. Markets reacted quickly: Bitcoin initially popped to $113,000 after the release before slipping to about $110,500, still up roughly 1.1% on the day, according to CoinGecko. Ethereum and XRP moved in the opposite direction, dipping about 1.1% to $4,300 and 0.7% to $2.82, respectively, with small fluctuations afterward.
Zach Pandl, head of research at Grayscale, said the labor softness could be the catalyst that cements Fed rate cuts in the months ahead — a development that markets and crypto investors are watching closely. He told Decrypt that while a jobs print like this typically raises recession concerns, an unusual decline in immigration is also weighing on labor supply, meaning the slowdown might not reflect collapsing demand.
Friday’s report also revised job counts for June and July, removing a total of 21,000 positions across those months: the U.S. lost about 13,000 jobs in June and added 6,000 more in July than previously reported. Those downward adjustments increase the case for easier policy, which would likely weaken the U.S. dollar relative to other currencies and precious metals.
Pandl noted that “all else equal, a weaker dollar [and] stronger gold price is positive for Bitcoin,” linking macro moves to crypto valuations. Equities reacted: the S&P 500 slipped 0.8%, the Nasdaq fell 0.6%, and the Dow dropped about 363 points after earlier gains.
Fed funds futures traders moved decisively overnight: per CME FedWatch, they price in an 88% chance of a 25-basis-point cut and a 12% chance of a 50-basis-point cut in coming months. Chair Jerome Powell has acknowledged a sharp falloff in immigration and described the labor market as reaching a “curious kind of balance,” with rising downside risks.
Risk awareness: Crypto is sensitive to macro shifts and remains volatile. Market moves tied to Fed policy expectations and dollar strength can reverse quickly; weigh risks and time horizons before trading or investing. This is not financial advice.
Source: Decrypt. Read the original coverage for full details.