US Employment Data Causes Bitcoin to Drop

Today was a remarkable day for the US labor force with the release of highly anticipated US employment data that revealed an amazing 517 thousand job increase in January, far surpassing expectations of 185 thousand. This great news caused Bitcoin ‘s price to drop to $23,244 shortly after the announcement and remain at approximately 23K today.

Why Are Markets Falling?

The question on everyone’s mind is why Bitcoin and other markets have dropped in reaction to employment data. According to economists we consulted, the reason lies within the fact that employment exceeded expectations which signals a strong economy, resulting in speculations of interest rate hikes. This speculation has caused a destabilization of financial markets.

“It Is An Indicator That Inflation Will Not Decrease At The Desired Level”

The most recent non-farm employment data came in above expectations, signaling that unemployment is trending downward. This runs contrary to the Federal Reserve’s tactic of raising interest rates to cool down the economy – since a side effect of this cooling would be increased unemployment. Thus, it appears as though there has not been significant cooling yet, which could lead one to believe that higher rates should be implemented. Another potential result may even include an overvaluation of the dollar.

US Employment Data Causes Bitcoin to Drop

“Inflation Data Is Also Necessary To Make Decisions About The Bitcoin”

The economy is still going strong for now, making a recession unlikely. Nevertheless, inflation will likely continue in the near future. It’s also critical to look at other data points; examining the current inflation rate gives us an idea of where we’ll be heading with crypto money markets over the next few months.

Other current content that may interest you: VeChain Aims to Catch Up the Tide with “The HiVe”

Vera Golubev

Vera holds a master's degree from New York University in Business and Economics, was a banker turned writer who discovered cryptocurrency, now a fintech blogger, crypto journalist, and growth marketer. She is passionate about helping startups spread the word, discover and promote great projects in the crypto and fintech industry.

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