US Unemployment Rate Rises, Potential Interest Rate Cut by Year End? Bitcoin Surpasses 63K

The US Department of Labor released the April nonfarm payroll data yesterday, which showed an increase of only 175,000 jobs, lower than analysts’ expectations. The unemployment rate also rose to 3.9%. The market anticipates a rate cut by the Federal Reserve at the end of the year. As a result, the Dow Jones Industrial Average rose 450 points yesterday, and Bitcoin surpassed 63,000 yuan.
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Nonfarm Payroll Below Expectations, Unemployment Rate at 3.9%
Federal Reserve Stops Raising Interest Rates
Bitcoin Surpasses 63K
The US labor market is gradually slowing down. According to the Department of Labor’s data released yesterday, the increase of 175,000 jobs in April was lower than analysts’ expected 241,000 jobs, marking a new low since October 2023. The unemployment rate also slightly increased from the previous month’s 3.8% to 3.9%.
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Historical Data of US Nonfarm Payroll and Unemployment Rate
(Data Source)
There is usually a negative correlation between the unemployment rate and future inflation. Therefore, the slowdown in the job market in April seems to be anticipating the end of inflation, and the market expects a rate cut this year.
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As expected by the market, the Federal Reserve has maintained interest rates for the sixth consecutive time this week. Powell stated that although the inflation control target has not been achieved, the next interest rate policy is unlikely to be another rate hike, which has generally made the market optimistic.
(Federal Reserve Maintains Interest Rates, Powell Says “Next Step Unlikely to Be a Rate Hike”)
However, Powell also emphasized that the evaluation will be based on actual inflation conditions.
Benefiting from the above market news, the Dow Jones Industrial Average rose 450 points (1.18%). The price of Bitcoin continued to rise from 59K to 63K this morning, with a daily increase of about 7%. Ethereum also reached $3,100, with an increase of about 4.5%.
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Further Reading
Federal Reserve Maintains Interest Rates, Powell Says “Next Step Unlikely to Be a Rate Hike”
A comprehensive look at tonight’s Federal Reserve expectations, with the possibility of adjusting interest rates almost zero.