Weak U.S. Jobs Data Spurs Treasury Rally, Crypto and Stocks Plunge

Weak U.S. Job Growth Fuels Rate Cut Bets as Treasury Yields Fall, Gold Surges, and Crypto Stocks Plunge

  • U.S. July job growth figures show the weakest three-month period since 2020.
  • Expectations rise for the Federal Reserve to start rate cuts in September.
  • The 10-year Treasury yield dropped to 4.22%, while Gold surged 1.5% near its record high.
  • Bitcoin and major stock indexes fell, with Nasdaq down 2.5% and bitcoin over 3% lower.
  • Crypto-related stocks experienced steep declines, especially Coinbase and Riot Platforms.

The latest U.S. employment data released on Friday showed July’s job growth was weak, with lower revised numbers for June and May. This resulted in the slowest three-month stretch of job gains since the COVID-19 shutdowns in 2020.

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The employment data has increased expectations that the Federal Reserve may move to cut interest rates at its next meeting in September. Following the report, the yield on the 10-year U.S. Treasury bond fell sharply by 14 basis points to 4.22%. Gold prices climbed 1.5% to $3,400 per ounce, approaching previous record highs.

Risk-sensitive assets, including bitcoin and stocks, showed significant declines. With less than two hours remaining in the U.S. trading day, the Nasdaq fell 2.5% and bitcoin dropped over 3%, reaching $113,800. Other major cryptocurrencies such as Ether (ETH), Solana, BNB (Binance Coin), and Dogecoin each lost around 6%. XRP dropped 2.9%, the smallest decline among major coins.

Former President Trump commented on the jobs report, posting on Truth Social: “Jerome ‘Too Late’ Powell is a disaster… DROP THE RATE.” He later called for the firing of Dr. Erika McEntarfer, the Commissioner of Labor Statistics, accusing her of manipulating jobs data. The statement can be viewed here.

Shares of crypto-related companies also suffered notable losses. Coinbase (COIN) stock dropped almost 18% after a disappointing earnings report released Thursday night. Robinhood (HOOD) declined by 3.1%. Bitcoin mining firms Riot Platforms (RIOT) and MARA Holdings (MARA) dropped 17% and 3%, respectively. Circle (CRCL), a stablecoin issuer, and Strategy (MSTR), a leading bitcoin treasury company, each fell 7.5%.

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These moves came as investors weighed the weaker-than-expected jobs data and responded by reducing risk exposure across asset classes.

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