The U.S. economy saw a significant boost in September with the addition of 254,000 jobs, surpassing economist predictions of 140,000. This strong job growth also led to a decrease in the unemployment rate from 4.2% in August to 4.1% in September, beating forecasts. The positive employment data had a ripple effect on various markets, including Bitcoin, which experienced a slight increase in price following the report.
In addition to the job gains, average hourly earnings also saw an uptick in September, rising by 0.4% and outperforming expectations. On a year-over-year basis, average hourly earnings were up by 4.0%, exceeding estimates. These positive economic indicators, along with recent strong reports and comments from Federal Reserve Chairman Jerome Powell, have caused traders to reconsider expectations for a 50 basis point rate cut at the Federal Reserve’s upcoming meeting in November.
Prior to the release of the job data, the market had priced in a 30% chance of a 50 basis point rate cut, but this likelihood dropped to just 11% after the strong report. Following the news, U.S. stock index futures have continued to rise, with the Nasdaq 100 up by 0.8%. The U.S. 10-year yield also increased by eight basis points, reaching 3.94%, while the dollar index saw a significant jump of 0.5%. On the other hand, the price of gold dipped by 0.5% to $2,665 per ounce.
Overall, the robust U.S. economy has instilled confidence in the market, reducing uncertainty and providing a positive outlook for various sectors. The strong job numbers, coupled with the increase in average hourly earnings, have painted a promising picture for the economic recovery. Traders and investors are now adjusting their expectations for the Federal Reserve’s next policy meeting in light of this new data, signaling a shift in market sentiment towards a more optimistic outlook.