According to CoinDesk, the U.S. job market experienced a notable slowdown in July, with the economy adding only 114,000 jobs, significantly below the anticipated 175,000. This figure also represents a decline from June's revised total of 179,000, which was initially reported as 206,000. The unemployment rate rose to 4.3% in July, up from 4.1% in June, surpassing forecasts that had predicted it would remain at 4.1%.
The impact on the cryptocurrency market was minimal, with the price of bitcoin remaining relatively stable at $64,500, showing little change from the previous 24 hours. In contrast, traditional financial markets reacted more strongly. The yield on the 10-year Treasury note fell by 15 basis points to 3.83%, and the two-year yield dropped by 23 basis points to 3.93%, both reaching their lowest levels in over a year. Stock markets also responded negatively, with Nasdaq futures declining by 2.3% and the S&P 500 falling by 1.6%.
The dollar weakened by 0.6%, while gold prices surged by 1.3%, reaching a new record high of $2,513 per ounce. Other economic indicators showed mixed results. Average hourly earnings increased by 0.2% in July, below the expected 0.3%, and were up 3.6% on an annual basis, compared to the anticipated 3.7% and June's 3.8%. Average weekly hours worked also fell short of expectations, coming in at 34.2 hours, down from the forecasted 34.3 hours and June's 34.3 hours.
In response to the weaker job market data, traders are increasingly betting on more significant interest rate cuts by the Federal Reserve. The CME FedWatch tool now indicates a 70% probability of a 50 basis point rate cut in September, up from just 22% the previous day. Additionally, traders are beginning to anticipate a total of 125 basis points in rate cuts by the end of the year, compared to the previous expectation of 75 basis points in cuts for 2024.
