The U.S. unemployment rate fell to 4.1% in October, below market expectations of 4.2% and September’s 4.2%.
The U.S. Bureau of Labor Statistics released October’s nonfarm payrolls data today (November 6), and the figures were significantly better than expected. Job gains in August were revised up from 133,000 to 186,000, while September’s were revised up from 29,000 to 60,000—a combined upward revision of 84,000 jobs over the two months.
This report matters because the Fed just raised rates on September 16, its first rate hike since 2023. The labor market hasn’t cooled, suggesting that rate hikes have yet to curb demand. The challenge facing Fed Chair Kevin Warsh has grown.
The market reaction was immediate:
- Spot gold briefly plunged by more than $30 to $4,042 per ounce
- Short-term interest rate futures fell, as traders increased their bets on another Fed rate hike in December
- Canada’s unemployment rate edged up to a six-month high in October, pointing to diverging trends across North America
For crypto markets, this is a bearish combination. Higher rate expectations can drain liquidity from risk assets. $BTC and $ETH are most sensitive to the U.S. dollar and real interest rates. My view is that expectations for a December rate hike will continue to build, so short-term rebounds should be treated with caution.
Next, we’ll need to see whether November’s CPI confirms that inflation is rising again in tandem. If it does, do you think $BTC can hold its current range?⚠️
#NFP #Fed #InterestRates
The U.S. Bureau of Labor Statistics released October’s nonfarm payrolls data today (November 6), and the figures were significantly better than expected. Job gains in August were revised up from 133,000 to 186,000, while September’s were revised up from 29,000 to 60,000—a combined upward revision of 84,000 jobs over the two months.
This report matters because the Fed just raised rates on September 16, its first rate hike since 2023. The labor market hasn’t cooled, suggesting that rate hikes have yet to curb demand. The challenge facing Fed Chair Kevin Warsh has grown.
The market reaction was immediate:
- Spot gold briefly plunged by more than $30 to $4,042 per ounce
- Short-term interest rate futures fell, as traders increased their bets on another Fed rate hike in December
- Canada’s unemployment rate edged up to a six-month high in October, pointing to diverging trends across North America
For crypto markets, this is a bearish combination. Higher rate expectations can drain liquidity from risk assets. $BTC and $ETH are most sensitive to the U.S. dollar and real interest rates. My view is that expectations for a December rate hike will continue to build, so short-term rebounds should be treated with caution.
Next, we’ll need to see whether November’s CPI confirms that inflation is rising again in tandem. If it does, do you think $BTC can hold its current range?⚠️
#NFP #Fed #InterestRates
