Weak US Jobs Data Cuts Fed Hike Odds to 44%

Traders have revised their predictions for a Federal Reserve rate hike after weak US jobs data was released, cutting the odds of a September move to 44%. The Bureau of Labor Statistics (BLS) reported that non-farm payrolls unexpectedly fell by roughly 23,000 in July, defying forecasts of an 83,000 rise. Bitcoin barely budged in response, rising only 0.7% to $65,300.

The CME Group's FedWatch tool now puts the probability of a September rate hike at 44%, down from earlier predictions. This decline comes as Treasury yields fell and Dow futures climbed close to 200 points. Average monthly job creation across the past year has slowed to 34,000.

Revisions to previous months' data revealed that May payrolls were cut by 66,000 to 63,000 and June by 37,000 to 20,000. This left the two months a combined 103,000 weaker than previously reported. Health care added 22,000 jobs, but below its monthly average of 36,000.

CryptoPotato noted that Bitcoin's reaction was muted compared to earlier surprises when stronger-than-expected labor data triggered a hawkish repricing and drove the asset down by 20%. Chris Zaccarelli, chief investment officer at Northlight Asset Management, said: 'This morning's report is a game changer in the sense that all of the recent focus has been on inflation and this report highlights the risks that are embedded in the labor market as well.'