#WeakNFPShakesRateHikeOdds

I already discussed this issue in detail in a previous message, where I noted that the June employment report came in at 57,000, far below expectations, that previous months' figures were also revised downwards, and that expectations for a Fed interest rate hike had sharply declined as a result. That analysis remains relevant; no new data has been released in the intervening period that would change this picture.
To briefly reiterate, non-farm payrolls came in at only 57,000, against expectations of 110-114,000. The April and May figures were revised downwards by a total of 74,000, and the unemployment rate fell to 4.2%, but this is more due to a decrease in labor force participation than an improvement. Following this data, the probability of a July interest rate hike dropped from 34% to below 19% according to CME FedWatch data. Combined with Fed Chairman Warsh's pre-data statements about reduced inflation risks, the market quickly shifted towards a "Fed will not act in the near term" scenario.
As a new development to add, it should be noted that the market reaction after this weak data was truly significant. Bitcoin and Ethereum experienced a strong recovery in the first days of July, with a weak dollar and falling bond yields supporting risk appetite. ETH rose by over eleven percent during this period, while Bitcoin climbed to the $62,000 level. In short, the impact of the weak employment data on the market was not theoretical; it transformed into a real and measurable risk asset rally.
From now on, the key question is whether this weakness is a one-off anomaly or the beginning of a more permanent slowdown. Because the Fed has removed its forward guidance, the next major data points, the July inflation figures and the July 28-29 FOMC meeting, will carry much more weight than usual. For those tracking risk assets through Gate, each new data point in these two weeks will be a decisive factor in either reinforcing or reversing the current expectation of loose monetary policy.
#WeakNFPShakesRateHikeOdds