The US labor market weakened appreciably in February, possibly putting the possibility of a rate cut by the Federal Reserve in the first half of 2026 back into play.
The country lost 92,000 jobs last month, according to Friday’s report from the Bureau of Labor Statistics. Economists had forecast the creation of 59,000 new jobs, compared with an increase of 126,000 in January.
The unemployment rate rose to 4.4% versus economists’ expectations of 4.3% and January’s reading of 4.3%.
Under pressure overnight ahead of report and trading at $70,000 as oil soared and stock markets fell, bitcoin it remained near that mark in the minutes following the data.
US stock index futures continue lower, with the Nasdaq down 1% and the S&P 500 down 0.8%. The 10-year Treasury yield has fallen four basis points to 4.11%. Precious metals reversed an initial decline, with gold now up 1% and silver up 2%. WTI crude oil has risen 6.2% to $86 per barrel.
Before this morning’s report, markets were pricing in a 95% chance that the Federal Reserve would keep rates steady at its March 18 meeting and an 85% chance that there would be no rate cut in April.
Meanwhile, rising oil prices linked to tensions in the Middle East could add upward pressure to inflation expectations. If maintained, higher energy prices can fuel broader inflation, particularly through energy and food costs. Combined with signs that the US economy could be accelerating again, this could lead markets to reassess the direction of monetary policy.
