Bitcoin, stocks, and gold rally as shock US jobs miss cools Fed hike talk

Jobs Data Shocks Markets

The US labor market delivered a sharp surprise on Friday. Nonfarm payrolls unexpectedly declined in July, falling by 23,000 amid a drop of 53,000 government jobs and softness in retail, leisure and hospitality. Wall Street had been braced for a gain: nonfarm payrolls were projected to increase by 83,000 in July while the unemployment rate would hold steady at 4.2%, according to the Dow Jones consensus.

The change in total nonfarm payroll employment for May was revised down by 66,000 and June was revised down by 37,000, meaning employment in May and June combined is 103,000 lower than previously reported. The unemployment rate edged lower to 4.1%, but was due largely to a further decline in those holding jobs or looking for work. The labor force participation rate declined to 61.4%, a level not seen in over five years.

Worker pay was nearly flat in the month as well, with the 12-month increase in average hourly earnings slipping to 3.2%, the lowest since May 2021. The breadth of the miss, combined with the downward revisions, reinforced the view that the US jobs market is cooling more quickly than policymakers had assumed.

Risk Assets Rally as Fed Hike Odds Fade

Markets wasted little time responding. According to the CME FedWatch tool, the market is now pricing in a 56% chance of a pause at the September 16 Fed meeting. The DXY fell to 99.5, extending its decline from a recent high of 101, and a weaker dollar is generally supportive of risk assets. Treasury yields also moved lower, with the US 10-year yield trading at 4.64%.

The moves rippled across asset classes. $BTC is up 4.6% since Monday, while precious metals rallied sharply, with gold and silver rising over 2.5% and 3.5% respectively, pushing gold to around $4,346. The S&P 500 pushed its total value to a record $70.5 trillion as equities extended their August gains.

The report comes with Federal Reserve policymakers split on where interest rates should head, and in recent days several Fed officials had spoken in favor of raising rates as soon as September if the pace of price increases does not ease. Friday's data gives the doves fresh ammunition heading into the September 16 FOMC meeting, though keeping rates unchanged could also create volatility if inflation remains elevated and long-term Treasury yields continue climbing.

Bureau of Labor Statistics: Employment Situation Summary, July 2026 | CNBC: Jobs Report July 2026 | CoinDesk: Bitcoin and Markets Live Update, August 7, 2026