YEREVAN (CoinChapter.com) — The United States added 256,000 jobs in December, as reported by the Bureau of Labor Statistics (BLS). This figure exceeded the forecast by 100,000 jobs, reflecting strong labor market performance. The six-month average job growth now stands at 165,000, the highest since July 2024.
December 2024 Employment Data. Source : BLSFed Policies: Rate Cuts and Bitcoin’s Reaction
The Federal Reserve initiated interest rate cuts in September 2024 to address slowing inflation and job growth. However, December’s robust job figures suggest the central bank may need to halt these cuts. Analysts at The Kobeissi Letter pointed out that the unexpected job surge might compel the Fed to reconsider its policy.
Fed Pivot Announcement. Source: Kobeissi LetterAccording to the report, there is now a 44% probability of no rate cuts until June 2025. If inflation rises further, the Fed could even consider rate hikes. This scenario generally discourages investments in risk assets like Bitcoin, as higher rates make traditional investments more attractive.
Monthly Payroll Growth. Source: BLS MacrobondBitcoin experienced a 9% flash crash in mid-December following announcements about reduced rate cuts. The cryptocurrency market often reacts strongly to changes in monetary policy, highlighting its sensitivity to external economic factors.
BTC Price Update Amid Economic Shifts
Bitcoin currently holds a market cap of $1.84 trillion, maintaining its position as the largest cryptocurrency and the eighth-largest asset worldwide. Despite its size, recent price trends indicate bearish pressure, with only a 0.22% gain in the last 24 hours.
While the Federal Reserve’s potential policy shift remains a key focus, Bitcoin’s performance also depends on other factors. Historical bull cycle trends and increasing institutional investments through spot ETFs continue to shape market dynamics.
However, strong labor market data and potential inflationary pressures may lead to further challenges for Bitcoin in 2025.
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