The cryptocurrency market was mostly sideways, with some major coins inching higher but others falling after the latest U.S. jobs data showed the labor market remains tight.
Source: Coin360
Initial jobless claims fell 3,000 to 192,000 in the week ended Feb. 18, but missed consensus estimates for 200,000. The strong jobs data has been dogging the Fed’s goal of lowering inflation to 2 percent from 6.4 percent.
Strong employment data, often associated with a booming economy, is not reflected in asset prices, as typically a good working environment leads to higher prices as organizations raise wages to recruit and retain talent. Talent is scarce.
However, bitcoin and ether defied the latest data and traded sideways throughout the day, with BTC down 0.5% and ETH up 0.5%. Selling pressure increased for the rest of the day.
Other related economic data on Thursday showed that U.S. gross domestic product (GDP) was expected to grow 2.7% in the second quarter, above expectations for a 2.9% increase.
Personal consumption expenditures (PCE) fell to 3.7% from 4.3% in the previous month, beating consensus expectations for a 3.9% increase. The data point highlights that while inflationary pressures have eased, they remain elevated.
This was underscored by the minutes of the latest Federal Open Market Committee (FOMC) meeting released on Wednesday earlier this month, with more than 10 of them citing inflation or growth individually. Wage growth “increased”. The cryptocurrency market will continue to pay close attention to the changing inflation regulations of the Federal Reserve Governor, especially if the price increase is unexpected.
Currently, the CME FedWatch tool gives a 75% chance that the FOMC will raise rates by 25 basis points at its upcoming March 22 meeting. A week ago, this probability was 85%, indicating that the possibility of raising interest rates by 50 basis points has increased.
The minutes of the Fed meeting showed that “several participants” favored a 50 basis point increase in the federal funds rate at the previous meeting. Stronger hikes would bring the target rate to a level that would help stabilize prices “faster.”
- Binance forcibly liquidated the derivatives positions of Australian users, and Bitcoin fluctuated sharply
- Bitcoin needs to hold this area to avoid a drop to $21,250
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According to Coindesk
