What to know:
- December U.S. job growth came in far stronger than expected at 256,000.
- The news sent bitcoin sharply lower and bond yields surging higher.
- The data further calls into question the need for the Fed to continue cutting rates in 2025.
In December, the job market in the United States gained momentum significantly, surpassing economist predictions substantially as job creation exceeded expectations, and surprisingly, the unemployment rate decreased.
Last month, the economy saw a job growth of approximately 256,000, as per the Bureau of Labor Statistics’ latest report released on Friday. This figure surpassed expectations of 160,000 new jobs and represented an increase from the 212,000 positions added in November (previously reported as 227,000).
The unemployment rate fell to 4.1% in December versus an expected 4.2% and November’s 4.2%.
After a significant drop earlier this week, Bitcoin (BTC) experienced a further decline of over 2%, dropping to approximately $92,800 shortly following the release of the report.
The economic data from today showed a downturn in the job market, following several recent economic reports that caused a widespread sell-off across various investment sectors. This was due to investors reconsidering their expectations for further interest rate reductions by the Federal Reserve in 2025.
Earlier this week, the crypto market took a significant hit, causing Bitcoin’s price to drop from around $103,000 on Monday down to under $92,000 at one point on Thursday. The major alternative cryptocurrencies experienced even steeper percentage decreases.
A glance at conventional markets reveals that U.S. stock index futures have experienced a mild decrease post the jobs report. Notably, the most pronounced response is observed in the bond market, where the 10-year Treasury yield has risen by nine basis points, reaching 4.78%.
2025 Federal Reserve interest rate cut predictions are being revised downward among traders, as the likelihood of a March rate cut has dropped to 28%, originally standing at 41%, following the recent report. Similarly, the probability of a May rate cut has decreased from 44% to 34%. (CME FedWatch data)
In the latest report, average hourly wages increased by 0.3% in December contrary to predictions of a similar rise, but still slightly lower than the 0.4% increase in November. On an annual basis, these earnings grew by 3.9%, falling short of the anticipated 4% increase and also below the 4% recorded in November.
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2025-01-10 16:47