The U.S. employment landscape showed significant improvement in September, with the government reporting the addition of 254,000 jobs, which notably surpassed economist predictions of 140,000. Furthermore, the job gains from August were revised upward from 142,000 to 159,000, indicating a stronger labor market than previously thought.
The unemployment rate also saw a decrease, sliding to 4.1% from 4.2% in August, which was contrary to forecasts that suggested it would remain at 4.2%. This positive data reflects the ongoing strength of the U.S. economy, bolstering investor confidence. Bitcoin's price remained relatively stable following the release of this favorable data, trading at $61,500, which is an increase of nearly 1.5% over the past 24 hours.
It's important to note, however, that bitcoin prices are still trending lower compared to the previous week's levels, which were above $66,000. This volatility in cryptocurrency pricing is influenced by macroeconomic factors, notably the escalating conflict in the Middle East, which continues to create uncertainty in global markets.
According to CoinDesk analyst James Van Straten, a robust U.S. economy is key to reducing market uncertainty, particularly in light of the upcoming U.S. election. This scenario is seen as favorable for bitcoin investors who are seeking stability in the face of geopolitical tensions. Additionally, average hourly earnings in September rose by 0.4%, exceeding forecasts of 0.3%, though this figure represents a decline from the 0.5% growth observed in the previous month.
Year-over-year, average hourly earnings increased by 4.0%, which surpassed the estimated increase of 3.8% and August's 3.9%. The positive economic indicators have been further supported by recent data from the ISM Services report and ADP jobs data, both of which were stronger than expected. Furthermore, comments from Federal Reserve Chairman Jerome Powell have shifted trader sentiments, leading to a decrease in expectations for a 50 basis point rate cut during the Fed's next policy meeting after the November elections. Before the release of the employment data, short-term rate markets had priced in a 30% chance of a 50 basis point cut and a 70% chance of a 25 basis point cut, as reported by CME FedWatch.
However, following the positive job data, the likelihood of a 50 basis point cut dramatically dropped to just 11%. In reaction to this economic news, traditional markets also showed signs of optimism, with U.S. stock index futures gaining momentum; specifically, the Nasdaq 100 experienced a rise of 0.8%.
In the bond market, the U.S. 10-year yield increased by eight basis points to reach 3.94%, while the dollar index rose by 0.5%, reflecting a stronger dollar. In contrast, the price of gold fell by 0.5%, settling at $2,665 per ounce, suggesting a shift in investor focus towards equities and away from safe-haven assets amid the positive economic news..