The labor market in the United States gained momentum in December: job growth far exceeded economists’ forecasts and the unemployment rate fell unexpectedly.
The economy added 256,000 jobs last month, the Bureau of Labor Statistics reported Friday, exceeding forecasts of 160,000 and up from 212,000 in November (revised from the 227,000 originally reported).
The unemployment rate fell to 4.1% in December compared to the expected 4.2% and 4.2% in November.
In an attempt to recover from considerable declines earlier this week, bitcoin (BTC) fell more than 2% immediately after the report to $92,800.
Today’s labor market readings came after a series of recent economic reports triggered a broad-based pullback across all asset classes, as investors quickly scaled back the idea of a continued series of Federal Reserve rate cuts in 2025.
Previously high-flying crypto markets were hit hardest by the sell-off, with bitcoin falling from nearly $103,000 on Monday to below $92,000 at one point on Thursday. Major altcoins suffered even bigger drops in percentage terms.
A review of traditional markets shows that US stock index futures fell about 1% following the jobs release. The strongest reaction came in the bond market, with the 10-year Treasury yield rising nine basis points to 4.78%. The dollar index is also rising, up 0.6%. Gold has fallen modestly to just below $2,700 an ounce.
Traders are rapidly reducing their bets on further Fed rate cuts in 2025, with the odds of a move in March falling from 41% to 28% just before the report, according to CME FedWatch. The odds of a rate cut in May have decreased to 34% from 44% previously.
In other closely watched details from the report, average hourly earnings rose 0.3% in December compared to forecasts of 0.3% and 0.4% in November. Year over year, average hourly earnings rose 3.9% versus expectations of 4% and November’s reading of 4%.
