The Breakdown How the Jobs Report Changes Rate Cut Calculus
Oct 8, 2024
A surprising jobs report shows significant payroll growth, shaking up Federal Reserve rate cut expectations. The mood in the crypto market shifts as traders fluctuate between optimism and caution in October. Attention turns to long-term vs. short-term holding behaviors, as new innovations aim to enhance the Bitcoin ecosystem. Legal challenges surface with Coinbase’s appeal against the SEC, highlighting the need for clearer regulations in crypto. Coinbase navigates EU stablecoin rules, while Tether faces its own regulatory hurdles.
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Stronger Labor Market
- September's jobs report exceeded expectations, showing unexpected strength in the labor market.
- Unemployment decreased, and wage gains increased, suggesting a healthier economy.
Impact on Fed Rate Cuts
- The strong jobs report may lead to fewer Fed rate cuts than anticipated.
- Markets now predict a single cut in both November and December, with rates remaining above 3%.
Market Reaction and Risk Appetite
- The stock market reacted positively to the jobs report, indicating strong risk appetite.
- This suggests markets believe in a soft landing as long as inflation continues to decline.