U.S. Added Just 114K Jobs in July, Unemployment Rate Shoots Up to 4.3%

The jobs market softened appreciably in July with the U.S. adding just 114,000 jobs during the month and the unemployment rate rising to 4.3%, according to the Bureau of Labor Statistics.

Those 114,000 jobs were well shy of expectations for 175,000 and down from 179,000 in June (itself revised lower from an originally reported 206,000).

The unemployment rate of 4.3% was up from 4.1% in June and above forecasts for 4.1%.

The price of bitcoin BTC$86,891.04 is about flat from just before the numbers hit, now trading at $64,500, and little-changed from 24 hours ago.

Reaction in traditional markets was far bigger, with the 10-year Treasury yield tumbling 15 basis points to 3.83% and the two-year yield a full 23 basis points to 3.93% – both levels the lowest in more than a year. Stocks aren't loving the numbers nearly as much, with Nasdaq futures now down 2.3% and S&P 500 lower by 1.6%.

Also on the move are the dollar, which has sunk 0.6%, and gold, which has risen 1.3% to a new record high of $2,513 per ounce.

Checking other report details, average hourly earnings rose 0.2% in July, shy of 0.3% expected, and 0.3% in June. On an annual basis, average hourly earnings were higher by 3.6% versus 3.7% expected and 3.8% in June. Average weekly hours also missed expectations, coming in at 34.2 against forecasts for 34.3 and 34.3 in June.

Having already fully priced in a 25 basis point Federal Reserve rate cut in September, traders are quickly amping up bets on an even larger move. According to CME FedWatch, there's now a 70% chance of a 50 basis point Fed cut in September versus only a 22% chance one day ago. A check of the December meeting shows traders beginning to place bets on a total of 125 basis points in rate cuts between now and the end of the year. One day ago, the overwhelming odds were for just 75 basis points of rate cuts in 2024.