Bitcoin News

Story: May Jobs Beat Sends Bitcoin Toward $60K as Fed Rate Cut Hopes Fade

By Julie Binoche

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Fed Stays Tight, Borrowing Costs Stay High. The Federal Reserve meets June 16-17. Going into that meeting, policymakers now have more…

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Bitcoin's 17% Drop and the ETF Exodus. Bitcoin's sensitivity to liquidity conditions is well-documented at this point.

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What the Fed's Balancing Act Means for Crypto. The Fed's position hasn't really changed. It wants inflation closer to 2%. It's at 3.8%.

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The numbers came in hot. The US economy added 172,000 jobs in May, blowing past Wall Street's forecast of 80,000 — more than double what economists predicted.

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The jobs report landed like cold water on anyone hoping the Federal Reserve would finally start cutting rates.

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The Federal Reserve meets June 16-17. Going into that meeting, policymakers now have more justification than ever to hold rates where they are. Inflation sat at 3.

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That means mortgages stay expensive. Credit card debt stays expensive. Refinancing stays expensive.

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Not a great picture for consumer spending.

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May's gains were spread across those three main sectors, and the revisions to earlier months only reinforce the sense that spring hiring was solid across the board.

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Bitcoin's sensitivity to liquidity conditions is well-documented at this point. When money is easy and rates are low, risk assets — crypto included — tend to attract capital.

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Over the week, Bitcoin dropped roughly 17%. That's a significant move, and the jobs report wasn't the only factor.

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Read also: Pound Slides After U.S. Payrolls Beat Forecasts, Dollar Climbs Hard

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Fabian Dori, Chief Investment Officer at Sygnum Bank, said the strong jobs report complicates expectations for rate relief.

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So even if there's a brief bounce, the structural headwind is still there.

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The Fed's position hasn't really changed. It wants inflation closer to 2%. It's at 3.8%. Jobs are growing faster than expected. Energy costs are elevated.

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