Unemployment Rates in the US Impacting Cryptocurrency Market

After the announcement of the CPI statistics, there was a shift in the overall market sentiment.. Bulls regained control, and Bitcoin eventually broke below the $24,000 barrier.

According to the Bureau of Labor Statistics (BLS), the United States created 517,000 new jobs in January, a significant increase from the revised 260,000 in December and far beyond economist expectations of 185,000.

The most recent statistics are extremely unexpected. Only 185,000 new jobs were predicted to be added to non-farm payrolls in January, according to a Reuters survey of economists. In addition, unemployment has marginally decreased from 3.5% in December to 3.4% now. But the same was predicted to increase to 3.6%.

Despite the massive wave of layoffs that affected some of the biggest companies in the country, the unemployment rate surprisingly dropped and more jobs were added back to the labor market than anticipated in January. 

Rubeela Farooqi, the chief U.S. economist at High-Frequency Economics, recently told Reuters, “We caution against extrapolating. Overall, the BLS data show the economy continues to create jobs at a strong pace, and the labor market is showing only gradual signs of softening despite a rapid increase in interest rates.”

In line with almost all predictions, the Fed increased interest rates by 0.25% this week, and Chair Jerome Powell has stirred things up by invoking the word “disinflation” in accompanying remarks.

According to the CME FedWatch Tool, the likelihood of more interest rate increases in March and May dramatically increased following the jobs report. These changes added to indications that the American economy might not be slowing down sufficiently for the Federal Reserve to abandon its abrasive drive to contain price increases.