What happened?
Bitcoin is trading at around $104,800 after gaining nearly 2.50% over 24 hours, even though stronger-than-expected U.S. job data has dampened hopes for rate cuts. The U.S. added 139,000 jobs in May, surpassing the expectation of 125,000, indicating economic strength and reducing the Federal Reserve’s incentive to cut rates. Nonetheless, former President Donald Trump has called for a full 1% rate cut, describing it as potential “rocket fuel” for the economy, though the Fed is unlikely to change its stance before September.
Who does this affect?
This situation affects Bitcoin traders and investors, as well as the broader cryptocurrency market, which reacted mixedly with Bitcoin rising but altcoins like Ethereum and Dogecoin experiencing losses. It also impacts policymakers at the Federal Reserve who are weighing economic indicators against financial stability. Additionally, companies like Metaplanet, aiming to expand their Bitcoin holdings, and MicroStrategy, planning further investments, are closely monitoring the market dynamics.
Why does this matter?
The developments in the job market and calls for interest rate cuts have immediate implications for both traditional and crypto markets. While stronger job numbers typically diminish chances of rate cuts, increased pressure from influential figures like Trump could drive volatility. For Bitcoin, institutional moves such as those by Metaplanet and MicroStrategy are significant, as they can tighten supply, increase fear of missing out (FOMO) among institutional investors, and potentially drive up Bitcoin prices further.