- The U.S. economy added 22,000 nonfarm payrolls in August.
- Economists had anticipated about 75,000 new jobs.
- Bitcoin briefly rose to $113,000 then fell to $110,500; Ethereum and XRP moved lower.
- Grayscale research head Zach Pandl said the weak report increases the odds of Federal Reserve rate cuts.
- Traders placed an 88% chance on a 0.25 percentage-point Fed cut, per the CME FedWatch tool.
The U.S. economy added 22,000 jobs in August, the U.S. Bureau of Labor Statistics reported, while the unemployment rate rose to 4.3% from 4.2%. This weaker jobs report immediately affected stock and cryptocurrency markets on the day of release.
Economists had anticipated about 75,000 new jobs in August. Following the release, Bitcoin climbed to $113,000 and then dropped to $110,500, showing a roughly 1.1% rise over the prior 24 hours on data from CoinGecko. Ethereum fell to about $4,300 and XRP to $2.82 during the same period.
The report included downward revisions that removed 21,000 jobs from June and July combined: June lost 13,000 jobs and July was revised up by 6,000 from prior estimates. Zach Pandl, head of research at Grayscale, said the report could push markets toward higher crypto valuations if equities remain stable.
Pandl noted the labor weakness partly reflects lower immigration, and cautioned against treating the data as a standard recession signal. He said, “We know stocks fall in a recession, but they may not fall in a sluggish labor market driven by immigration cuts.” He added, “We know that reduced immigration has played a big role, and the slowing jobs market is not just about firms pulling back on hiring or on labor demand.”
Federal Reserve Chair Jerome Powell acknowledged a sharp falloff in immigration and described the labor market as hitting “a curious kind of balance.” Traders on Friday assigned an 88% probability to a 0.25 percentage-point rate cut and 12% to a 0.50% cut, per the CME FedWatch tool.
Pandl also said a weaker dollar and stronger Gold would likely help cryptocurrencies, stating, “All else equal, a weaker dollar [and[ stronger gold price is positive for Bitcoin,” and noted the report will likely make Fed easing more likely in coming months.
Market indexes moved on the report: the S&P 500 fell about 0.8%, the Nasdaq dropped 0.6%, and the Dow Jones Industrial Average slipped 363 points after earlier reaching a record high.
(Nonfarm payrolls measure the number of jobs added or lost across the economy, excluding farm workers, private household employees and nonprofit organization staff.)
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