Bitcoin climbs after US jobs miss bolsters Fed rate-cut bets

Bitcoin rose after the US added just 57,000 jobs in June, well below the 110,000 consensus estimate, strengthening the case for Fed rate cuts.

"The weaker-than-expected payrolls number reinforces the narrative that the economy is cooling, which should keep the Fed on hold and potentially open the door for rate cuts later this year," Jeffrey Roach, chief economist at LPL Financial, said.

The unemployment rate dipped to 4.2% from 4.3%, while the labor force participation rate fell 0.3 percentage points to 61.5%. Revisions shaved 74,000 jobs from the prior two months' tallies, with April's gain cut to 148,000 from 179,000 and May's reduced to 129,000 from 172,000. The leisure and hospitality sector shed 61,000 jobs in June, reflecting weaker-than-usual seasonal hiring, while healthcare added 21,500.

The data strengthens expectations that the Federal Reserve will hold rates steady at its next meeting, with CME FedWatch data showing a 41.8% probability of a 25-basis-point hike by year-end versus a 21.7% chance of no change. Lower interest rates reduce the opportunity cost of holding non-yielding assets like Bitcoin and increase liquidity in the financial system, a dynamic that has historically supported risk assets.

The S&P 500 rose about 0.7% in morning trading following the release, while the Dow Jones Industrial Average gained 0.6% and the Nasdaq Composite added 0.7%, reflecting broad risk-on sentiment across markets.

This article is for informational purposes only and does not constitute investment advice.