Key facts
- Bitcoin traded above $86,700, up over 2% on the day.
- U.S. nonfarm payrolls rose by 29,000 in September, below expectations of 89,000.
- The unemployment rate increased to 4.2% from 4.1% in August.
- Odds of a 25 basis point Fed rate hike in October fell to 17%.
- There is an 84% chance the Fed will hold rates steady at the October FOMC meeting.
Bitcoin's price surged above $86,000, marking a more than 2% gain on the day, as the latest U.S. jobs report revealed a significant slowdown in employment growth. The U.S. added only 29,000 nonfarm payrolls in September, falling far short of the 89,000 economists had predicted. This figure is also a sharp decrease from the 162,000 jobs added in August.
The unemployment rate ticked up to 4.2% from 4.1% in the previous month, reaching a three-month high. This weaker-than-expected labor market data, combined with recent soft inflation figures, has led to a substantial reduction in the probability of a Federal Reserve interest rate hike in October. Data from Polymarket indicates that the odds of a 25 basis point increase this month have dropped to 17%, down from a high of 70%.
Conversely, the market now assigns an 84% probability to the Fed holding rates steady at its upcoming FOMC meeting. New York Fed President John Williams has also indicated a lack of urgency for further rate increases. Goldman Sachs has suggested that additional hikes this year may be deemed unnecessary by the central bank, further supporting the view that the Fed may pause its tightening cycle.