The most anticipated U.S. employment data this week showed 272,000 jobs added in May, more than market expectations. The market was eagerly awaiting labor data for possible clues about the current health of the labor market. Notably, this data is closely monitored by investors to understand the current economic health and decide on the outlook for interest rate policy.
A look at US employment data
The U.S. added 272,000 jobs in May, after adding 175,000 jobs the previous month, according to data from the Bureau of Labor Statistics. Notably, the unemployment rate rose to 4% from the previous month and was higher than market expectations of 3.9%.
On the other hand, US hourly wages rose 0.4% in May, following a 0.2% increase in the previous month. Notably, investors have been eagerly awaiting this labor data for clues about possible interest rate cuts decisions by the Federal Reserve.
Meanwhile, market experts have said that unexpectedly robust non-farm labor data may have dampened hopes for a dovish stance from the Fed with its interest rate cutting plans. Now, the surge in non-farm labor data could dampen market sentiment. However, higher unemployment data paints a contrary picture.
Typically, a higher unemployment rate along with lower non-farm payroll data boosts market sentiment.
Will Bitcoin Reach New Highs?
US labor data paints a mixed picture with both the unemployment rate and non-farm employment rising in May. Looking at the recent performance of the crypto market, it seems that the latest labor data has affected traders’ sentiment.
With the ECB’s recent decision to cut interest rates, expectations have risen about a similar move by the US Federal Reserve. But with the latest US labor report, sentiment appears to have changed.
Now the market will be closely watching key inflation data in the coming week, including the US Consumer Price Index (CPI) and Producer Price Index (PPI). Moreover, one of next week’s key events, the FOMC’s interest rate decision, will play a major role in shaping market sentiment.
After the labor data, the U.S. 10-year Treasury yield rose 3.32% to 4.421, while the U.S. Dollar Index rose 0.56% to $104.630. However, the latest report from the Ministry of Labor has caused the Bitcoin (BTC) price to drop from a 24-hour high of around $72,000 to $70,875.25 in just a few minutes. The recent drop in BTC price showed how the latest data has weighed on investors’ risk appetite.
Source: https://cryptobenelux.com/2024/06/07/bitcoin-daalt-iets-na-stijging-van-amerikaanse-werkgelegenheid/
