The U.S. labor market delivered a major surprise on Friday, after new data showed the economy lost 92,000 jobs. It marks one of the rare monthly employment declines since the pandemic era.
The weak report raises concerns about the strength of the economic recovery. Bitcoin fell below $70,000 as financial markets remain skeptical that policymakers will immediately respond with interest rate cuts.
Bitcoin Responds to US Nonfarm Payrolls, But Not How You Expect
Data released by the U.S. Bureau of Labor Statistics showed Non-Farm Payrolls (NFP) dropped by 92,000 jobs in February,
It sharply missed forecasts that projected 54,000 to 55,000 new jobs. The result also reversed January’s revised 126,000 job gain, highlighting a sudden shift in hiring momentum.
The labor market slowdown was further indicated by a rise in the unemployment rate. Joblessness climbed to 4.4%, exceeding expectations of 4.3% and signaling a gradual cooling in employment conditions.
Despite the negative headline figure, wage growth remained relatively strong. Average hourly earnings increased 0.4% month-over-month and 3.8% year-over-year, slightly above analyst estimates.
The persistence of wage growth suggests that inflationary pressures tied to labor costs have not fully dissipated, complicating the Federal Reserve’s policy outlook.
The Bitcoin price fell below the $70,000 psychological level, and was trading for $68,910 as of this writing.
Why Are Markets Not Expecting the Fed to Cut Rates Yet?
Even with the weak labor report, markets are not yet pricing in an immediate policy shift.
According to the CME Group FedWatch Tool, traders currently assign a 95.6% probability that the Federal Reserve will keep interest rates unchanged at its March meeting, maintaining the current target range of 3.50%–3.75%.
The divergence between the disappointing labor data and stable rate expectations reflects a broader dilemma facing policymakers.
While job losses point toward a slowing economy, persistent wage growth and elevated energy prices continue to threaten the Fed’s progress on inflation.
Recent geopolitical tensions in the Middle East have also pushed oil prices higher, further adding to the uncertainty of the inflation outlook.
Rising energy costs could keep overall price pressures elevated, potentially limiting the central bank’s ability to quickly pivot toward easing monetary policy.
Markets React with Volatility
Financial markets reacted swiftly to the data release. U.S. equity futures declined sharply as investors reassessed the outlook for economic growth.
Major indices, including the Dow Jones Industrial Average, the S&P 500, and the Nasdaq Composite, all moved lower following the report.
This suggests that the long-anticipated “soft landing” for the U.S. economy may be fading.
If labor market conditions continue to deteriorate in the coming months, pressure could build on the Fed to begin considering interest rate cuts later in 2026.
In the meantime, the weak report adds to global market uncertainty, leaving investors to contend with a complex mix of slowing growth, stubborn inflation pressures, and rising geopolitical risks.
