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As global markets continue to face selling pressure, all eyes were on the critical Non-Farm Payrolls, Average Hourly Earnings, and Unemployment Rate data released today in the United States. The data has just been announced. Here are the details.
Non-Farm Payrolls, Average Hourly Earnings, and Unemployment Rate Data Released
The highly significant macro analysis data, Non-Farm Payrolls, which shows the monthly change in the number of people employed outside the agricultural sector, came in below expectations (200,000) with an increase of 187,000 in July. The data was announced as 209,000 in June.
The Unemployment Rate data in the US came in below expectations at 3.5%. The data was announced as 3.6% in June. The Unemployment Rate data came in below both the previous data of 3.6% and the expected rate of 3.6%.
Meanwhile, the Average Hourly Earnings data in the US increased by 0.4% annually in July, while the previous data was 0.4% and the expectation for this data was a 0.3% increase.
Especially the Non-Farm Payrolls data from the announced data is crucial in terms of answering how tight the labor market is and what it means for inflation and the decisions of the US Federal Reserve (Fed) regarding monetary policy. Therefore, it is important for both the US economy and the direction of the crypto market along with global markets.
How Should the Data Be Interpreted for Bitcoin and Altcoins?
Strong labor force means a strong economy. Therefore, data that exceeds expectations causes the strengthening of the US dollar. On the other hand, a strong economy can pave the way for the Fed to increase interest rates more confidently. In other words, good data here means bad news for riskier markets like cryptocurrencies.
Under normal circumstances, strong employment results in a strong economy, so employment data that exceeds expectations is expected to have a negative impact on cryptocurrencies. High employment rates lead to a stronger national currency. In particular, the expectation of the Non-Farm Payrolls data in the US coming in above expectations is thought to lead to the strengthening of the US dollar and consequently accelerate the selling transactions of Bitcoin and altcoins, as well as precious metals.
On the other hand, if the data comes in below expectations, meaning a decrease in employment in the US, it would cause the US dollar to depreciate and result in sharp increases in the prices of Bitcoin, altcoins, and precious metals.
