of U.S. Bureau of Labor Statistics (BLS) released non-farm payrolls figures showing employment increased by 528,000 in July. That was more than double Wall Street’s expectation of an increase of 258,000.
Statistics show that the US unemployment rate is currently at 3.5%, higher than analysts’ expectations of a 3.6% unemployment rate.
Stocks and Bitcoin initially reacted negatively to the news.
Fed under pressure to fight inflation
Wage growth also jumped high, with average hourly wages rising 5.2% year-on-year in July, beating expectations of a 4.9% rise.
All of this puts more pressure on the Fed to continue its rate hike plans to stem runaway inflation, which is hovering at a 40-year high of 9.1%.
Tom Kozrickthe head of Local government research and analysis from HilltopSecurities commented that the job openings were a surprise. “There is no recession yet, and that means more aggressive Fed action is likely as well,” he said.
On July 27, the Fed hiked rates by 75 basis points for the second time in a row, raising the benchmark rate to between 2.25% and 2.5%. CNBC This is reported to be the “most severe consecutive measure” since the early 1990s.
As a result, many expected the central bank to enact lower rate hikes in the range of 25-50 basis points. FOMC meetingscheduled for September 20-21.
But news of a red-hot labor market means the Fed is likely to hike rates by another 75 basis points. The analyst says he has a 70% chance of this happening when the Federal Reserve reopens after the summer holidays.
Bitcoin and stock market decline
Following the news, Bitcoin fell 2% in the 1-hour candlestick at 13:00 (GMT). Since then, a local bottom of $22,800 has been reached, spurring a counterattack from the bulls, and BTC has nearly leveled out to the 13:00 candlestick high.
Meanwhile, the Dow Jones, S&P 500, and Nasdaq are all performing modest selling. The news sparked hopes that the Fed would have to act and do more to crack down on the overheating economy.
