The U.S. Bureau of Labor Statistics on July 7 released nonfarm payrolls (NFP) and unemployment rate data for June. The NFP came in at 209K for June, below market forecasts of 225K. It is the lowest reading since December 2020, but remains more than twice the 70k-100k needed per month to keep up with growth in the working-age population. The nonfarm payrolls came in at 306k last month.
Meanwhile, the unemployment rate came in line with market expectations at 3.6% but decreased as compared to May’s seven-month high of 3.7%. The jobs data indicate an anticipated economic slowdown in the U.S., while the Federal Reserve can continue raising interest rates to combat inflation.
While the US dollar index (DXY) fell below 102.75, which signals the crypto market will rise and Bitcoin could regain above $31k, the tight labor market is bearish for the economy. Also, job creation is positive, but reliance on government jobs for 28% of additions suggests a lack of robust private sector growth. This comes after the strong ADP Employment data showed 497,000 new jobs in June.
NFP coming in worse than expected.
Markets immediately responding to it with $DXY correcting.
— Michaël van de Poppe (@CryptoMichNL) July 7, 2023
Overall, the macro outlook remains challenging for Bitcoin, with treasury yields rising rapidly and volatility returning to the crypto and stock markets. The CME FedWatch tool indicates a nearly 90% probability of a 25 bps rate hike during the July FOMC meeting.
Keep in mind +209k jobs is still a good (not great) number, but the re-acceleration in nominal wage growth, flat LFPR, and falling unemployment rate represent a RESILIENT AND DYNAMIC LABOR MARKET.
— Caleb Franzen (@CalebFranzen) July 7, 2023
Also Read: Professor Edward Kim Unveils Terra Luna Classic’s AI Chain “Block Entropy”
Bitcoin and Ethereum Prices Rise
Bitcoin and Ethereum prices are increasing due to the US dollar weakness after the recent jobs reports. Both BTC and ETH jumped 1% after the nonfarm payrolls and unemployment rate data.
BTC price currently trades at $30400, up 2% from the intraday low of $29,777. The 24-hour high for Bitcoin is $31463. Meanwhile, ETH price currently trades at $1871, up 1% in the past 24 hours.
Also Read: US Fed Powell, ECB Lagarde Aggressively Hawkish, Can Bitcoin Price Still Hit $35000?
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