Markets rethink Fed rate cuts as Bitcoin circles $44K on US jobs data

Bitcoin (BTC) tapped $44,000 after the Dec. 8 Wall Street open as United States employment data shrunk market bets on interest rate cuts.

BTC/USD 1-hour chart. Source: TradingView

Bitcoin holds firm as jobs data unsettles U.S. dollar

Data from Cointelegraph Markets Pro and TradingView covered the latest BTC price action as risk assets reacted to the latest U.S. inflation cues.

Nonfarm payrolls came in above expectations at 199,000 versus 190,000, while unemployment was lower than forecast at 3.7% versus 3.9%, per an official release from the U.S. Bureau of Labor Statistics.

Both suggested that the full impact of Federal Reserve monetary tightening had yet to show itself, and while other data had already captured declining inflation, markets treated the labor figures nervously.

JUST IN: Interest rate futures shift from showing rate cuts beginning in March 2024 to May 2024 after jobs report.

Prior to the November jobs report, markets saw a 60% chance of rate cuts beginning in March 2024.

Odds of rate cuts beginning in January 2024 fell from 16% to 6%.… pic.twitter.com/hFYFLVP5xv

— The Kobeissi Letter (@KobeissiLetter) December 8, 2023

Data from CME Group’s FedWatch Tool nonetheless put the odds of anything other than a rate change freeze continuing at next week’s Fed meeting at practically zero.

Fed target rate probabilities chart. Source: CME Group

The U.S. Dollar Index (DXY) saw particularly pronounced volatility around the data, briefly hitting its highest levels since Nov. 20 before erasing its gains to trade at 103.8 at the time of writing.

U.S. dollar index (DXY) 1-hour chart. Source: TradingView