UK Jobs Recovery Clashes With Strong U.S. Data and Bitcoin Dip
Strong U.S. jobs data raised the odds of a Fed rate hike, after which Bitcoin slipped back below $79,000. In the UK, the labor market showed signs of recovery for the first time in years.
Key Takeaways
- UK permanent hiring rose in August for the first time since September 2022, pointing to a cautious recovery in the labor market.
- U.S. employers added 162,000 jobs, well above expectations, which increased the odds of a Fed rate hike.
- Bitcoin fell from above $80,000 to $78,649 after the U.S. jobs report, with a peak drop of 3.5%.
UK permanent hiring rose in August for the first time since September 2022, while strong U.S. jobs data sharply boosted speculation about a rate hike by the Federal Reserve. For crypto investors, the reaction in Bitcoin stood out most: the price pulled back after the U.S. labor market numbers came in.
UK Labor Market Turns Up
The Recruitment and Employment Confederation, together with KPMG, tracks permanent hiring in the United Kingdom every month. Their index rose to 50.5 in August, after 50.0 in July. That is the first reading above the neutral line in almost four years and points to a cautious recovery in the UK labor market.
Temporary work also showed more strength. Revenue from temporary work grew at the second-fastest pace in more than three years. Job vacancies still fell, but not as sharply as before, while candidate availability rose at the fastest pace in three months. According to the survey, starting salaries for permanent jobs also rose at the fastest pace since January.
Strong U.S. Data Puts Pressure on the Fed
On the other side of the Atlantic, the U.S. numbers came in much stronger than expected. Employers added 162,000 jobs in August, well above the 65,000 economists had expected. The unemployment rate held at 4.1%, while wage growth slowed to 3.1% year over year.
That mix kept the market focused on the Fed's next move. The odds of a rate hike at the upcoming meeting, measured by CME FedWatch, climbed to just under 60%. That came alongside a pullback on Wall Street, where the S&P 500 fell as much as 0.4% and the Dow Jones Industrial Average lost more than 260 points before some of that drop was recovered.
Bitcoin moved with it. The price had earlier been above $80,000 (€68,800), but after the jobs report it fell to $78,649 (€67,700), a drop of as much as 3.5%.
Why This Matters for Crypto
For European crypto readers, the combination of labor market data and rate expectations is especially important. Bitcoin often reacts quickly to shifts in interest rate policy, because higher rates can change the appeal of riskier investments. That was also visible when strong U.S. jobs data pushed Bitcoin below $80,000. If the Fed does raise rates on September 16, that could ripple through both the U.S. and Europe, where investors are already watching a fragile labor market recovery.
