In brief
- The labor market was stronger than expected in June, with U.S. employers adding 147,000 nonfarm jobs in June, while the unemployment rate ticked down to 4.2%.
- That extinguished hopes of an interest rate cut later this month, with traders penciling in a 4.7% chance on Thursday, from 24% a day before.
- Concerns about the country’s finances and pressure on Fed Chair Powell are still bolstering Bitcoin’s price, Grayscale’s head of research said.
The price of Bitcoin wavered on Thursday after a hotter-than-expected jobs report pointed to a resilient U.S. labor market, squashing hopes of interest rate cuts later this month.
Bitcoin was recently changing hands around $109,746, a 1.4% increase over the past 24 hours, according to crypto data provider CoinGecko. It was trading below the $109,000 mark when the report came out, then jumped above $110,000 before ticking back down to the current mark.
Ethereum jumped 5.2% to just under $2,600, while XRP and Solana rose 4.1% to $2.28 and 1.7% to $152, respectively.
Nonfarm payrolls grew 147,000 in June on a seasonally adjusted basis, surpassing economists’ estimates of 111,000 for the month, the Bureau of Labor Statistics said. Job growth for May was revised upward to 144,000, while April’s reading was also marked up to 158,000.
Although economists foresaw the unemployment rate rising to 4.3% in June as businesses navigate economic uncertainty marked by tariffs and geopolitical conflict, it dropped to 4.2%, the lowest level since February, according to Trading Economics.
Market participants grew less convinced that the Fed will cut interest rates at the conclusion of its meeting later this month, with traders penciling a 4.7% chance on Thursday compared to a 24% chance a day before, per CME FedWatch. Traders also grew more convinced that the Fed would hold rates steady through September, with odds rising to 25% from 6% on Wednesday.
Although lower interest rates tend to benefit risk assets like stocks and crypto due to cheaper borrowing and increased liquidity, Bitcoin’s price is still being bolstered by concerns about the country’s finances and U.S. President Donald Trump’s rhetoric toward Fed Chair Jerome Powell, Grayscale’s Head of Research Zach Pandl said on Twitter, formerly X.
“Bitcoin will be fine,” he said. “Big picture, we have [a] booming economy and markets, large peacetime budget deficits, and ongoing political pressure on the central bank.”
Trump has repeatedly called on Powell to lower interest rates, but the U.S. central bank has been steadfast as it tries to assess how shifts in trade and immigration are impacting the economy, leaving short-term interest rates unchanged for four straight meetings.
“Uncertainty about the economic outlook has diminished but remains elevated,” Powell said last month. In economic projections released alongside Powell’s remarks, policymakers penciled in two quarter-percentage point rate cuts.
The Fed only has four meetings left this year, and traders still believe that the Fed’s benchmark interest rate will settle between a target range of 3.75% and 4.00% by December’s end.
Trump’s pressure campaign against Powell escalated on Wednesday after William Pulter, director of the U.S. Federal Housing Finance Agency, claimed in a letter that the Fed chair lied before Congress about the scope of renovations to the Fed’s headquarters.
“Chairman Powell needs to be investigated by Congress immediately,” he wrote. “I am asking Congress to investigate […] his political bias and his deceptive Senate testimony.”
Edited by Andrew Hayward
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