Following the release of U.S. economic data, Bitcoin (BTC) 
$78,815 initially surged past the $92,000 mark, setting a new peak. However, this momentum was short-lived. Notably, the report highlighted a significant rise in the unemployment rate, reaching levels unseen in years. Let’s delve into the report’s details to understand what awaits the cryptocurrency market.
The U.S. Employment Report
Since October 2021, the U.S. unemployment rate had not surpassed 4.4%. This was the period when the Federal Reserve (Fed) was preparing to increase interest rates. Returning to these levels after four years indicates a need for the Fed to act more swiftly. However, mitigating this is the September non-farm payrolls figure, which came in at 119,000.
A year ago, the unemployment rate stood at 4.1% with 6.8 million jobless individuals. Today, there are 7.6 million unemployed, indicating that despite Trump’s immigration policies, Americans seem to struggle in finding employment.
Revisions are also crucial;
- July’s non-farm payroll was revised down by 7,000 to 72,000.
- August’s figures were revised down by 26,000, resulting in a total of -4,000. If correct figures were released, Powell’s hawkish stance in the October rate cut might have been significantly softened.
Potential Impact on Cryptocurrencies
The report, with its gloomy details, includes numerous layoffs and portrays a troubling employment landscape. Despite Bitcoin experiencing a downturn, the expectation for a rate cut should be reconsidered. Currently, the probability of a rate cut remains around 30%.
Considering Japan’s announcement of stimulus measures and bond yield increases, the Fed may be compelled to cut rates in December. We will closely watch upcoming Fed statements. It would be intriguing if Fed members assert that they offset unemployment with rate cuts, despite the highest unemployment rate since October 2021.
While the number of permanently unemployed individuals has reached 2 million, those temporarily unemployed have decreased to 833,000. We will continue to monitor and share Fed members’ comments on these figures. Currently, this report suggests that the expectations for a December rate cut affecting cryptocurrencies should be somewhat reduced. Trump may comment on this matter in the upcoming hours.
