Strong US Jobs Data Weighs Down Crypto Market
The crypto market pulled back on Thursday after strong US jobs data came in higher than expected. The US unemployment claims report showed a significantly lower number of individuals filing for unemployment insurance, coming in at 187,000 compared to the estimated 211,000.
This unexpected pullback led to a broader decline in the cryptocurrency market, with Bitcoin falling over 2.2%. The overall crypto market cap dropped by 2.06% within hours, from $2.24 trillion to $2.2 trillion.
The stronger-than-expected payroll report reduced the likelihood of near-term Federal Reserve interest rate cuts, putting pressure on the crypto market. Typically, strong US employment data leads to higher interest rates as a way to control inflation, which would pull liquidity away from risk-on assets like cryptocurrencies.