The US labor market continues to show strength as the government reported the creation of 303,000 jobs last month, compared to economists' forecasts of 200,000 and 270,000 in February (revised from previously reported 275,000).
The unemployment rate fell to 3.8% in March, against expectations of 3.9% and 3.9% in February.
The price of Bitcoin (BTC) fell about 0.5% to $66,000 in the minutes following Friday morning's report. In traditional markets, U.S. stock index futures gave up some of their earlier gains but are still trading slightly higher. The 10-year Treasury yield rose 6.5 basis points to 4.38% and the dollar index rose 0.5%.
Going into 2024, markets had priced in as many as five or six interest rate cuts from the Federal Reserve, starting as early as March. However, the economic data did not cooperate. In fact, inflation rose slightly in the first quarter of the year and job growth remained robust.
March apparently came and went without a rate cut, and traders had pushed expectations of the first rate cut to June or July ahead of today's numbers, according to the CME FedWatch tool. In total, only three rate cuts are expected for the full year, and even that could be too many.
In his speech yesterday, Minneapolis Fed President Neel Kashkari suggested there may be no rate cuts at all in 2024. His comments led to a sharp swing in stock markets, with major averages closing down more than 1%. Shortly after today's numbers, swap trading suggested that expectations for the first rate cut had been pushed back to September.
Examining other report details, the labor force participation rate increased from 62.5% to 62.7%, indicating that a significant number of people are returning to the workforce. Average hourly wages rose 0.3% in March, as expected, compared to 0.2% in February. Year-over-year, average hourly wages rose 4.1%, compared to 4.3% in February.
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