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What Comes Next as Strong US Job Data Pull Crypto Market Lower?

The most recent US employment figures impact the cryptocurrency market's mood and raise questions about the Federal Reserve's expected rate hikes.

by V. Sinclair
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Nonfarm Payrolls (NFP) increased significantly in September, above market forecasts, according to the most recent report from the US Bureau of Labor Statistics (BLS). Market reaction to these strong jobs figures was quick, indicating a range of opinions.

Notably, the surge in job numbers suggests a robust labor market, perhaps opening the door for the Federal Reserve to hike interest rates this year, despite a slowdown in pay growth.

What Is In The Job Data?
Unexpectedly, the NFP jumped by 336,000 jobs in September, significantly more than the market’s projection of 170,000. The August NFP data was also updated from 187,000 to 227,000, showing that the labor market is stronger than originally believed.

Nevertheless, despite the significant job growth, the unemployment rate stayed stable at 3.8% and the labor force participation rate did not move from 62.8%. These numbers imply that the US labor market has continued to be resilient.

The survey also showed a modest decline in annual pay inflation, with an average hourly salary that dropped from 4.3% to 4.2%. Concerns about additional rate increases by the Federal Reserve this year have also been fueled by the robust labor market.

The US Dollar Index, meanwhile, increased by 0.33% on the day to hit 106.417. The yield on US 10-year Treasury bonds also saw a significant spike, climbing by 2.57% to 4.835.

What Is The Reaction Of The Crypto Market?
The performance of the cryptocurrency market suggests that investors’ worries may have been exacerbated by the job report. The job report was widely anticipated by market investors because it could determine how the Fed will position its future policy rate plans. The robust data, however, indicated that the Fed still has some leeway to proceed with its intentions to raise interest rates.

As a result of the news, the market value of all major cryptocurrencies decreased by 0.95% to $1.08 trillion. Notably, Bitcoin’s recent 24-hour volume increased 21.70% to $12.99 billion, despite Bitcoin pricedeclining 2.23% to $27,405.17 at the time of writing.

Following the job statistics, Ethereum’s price simultaneously decreased by 1.17% to $1,625.80. However, at the time of writing, the XRP price was down 1.15% to $0.5194 and its one-day volume was down 16.84% to $767.48 million.

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