This morning’s figures may cool expectations that the Federal Reserve will raise rates as soon as this summer or early fall, after weaker-than-expected labor data pointed to a slowdown in hiring momentum.
U.S. employment growth missed forecasts in June, a result that could push back market pricing for a near-term Fed rate hike. The Nonfarm Payrolls report showed the economy added just 57,000 jobs.
That was well below economists’ estimate of 110,000 and also a sharp deceleration from May’s revised gain of 129,000, which had originally been reported as 172,000.
The unemployment rate ticked down to 4.2%, versus expectations of 4.3% and May’s 4.3% reading. The decline came alongside a weaker labor market, as the labor force participation rate fell to 61.5% from 61.8%.
Bitcoin BTC $61,813.31 traded firmly ahead of the release and stayed above $61,000, rising about 4% over the past 24 hours.
Markets reacted positively overall, with Nasdaq 100 futures climbing roughly 0.7% after trading near flat before the data. The 10-year Treasury yield also slipped four basis points to 4.46%.
Interest rate expectations have been a dominant macro driver this year. Earlier in the year, hopes for policy easing—supported by political pressure from President Trump for lower rates and speculation over changes at the Federal Reserve—had shaped expectations for 2026 cuts.
But rising energy prices helped push inflation higher in the first half of the year, prompting a more hawkish shift from new Fed Chair Kevin Warsh, who surprised markets with a tighter policy stance at the most recent Fed meeting.
Following the jobs report, rate expectations shifted quickly. CME FedWatch data showed the probability of one or more rate hikes by September dropped from around 65% to 50% shortly after the release.
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