The recent U.S. jobs data shows a mixed bag, with the private sector shedding 32,000 jobs in November, the largest monthly drop in over two years. Nonfarm payrolls have posted five declines over the last seven months, marking the worst streak in at least five years. This weakness in the labor market has contributed to a 94% probability of a 0.25% interest rate cut by the Federal Reserve at its upcoming meeting
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Implications for Federal Reserve Policy
The Fed is expected to deliver its third straight rate cut this week, amid concerns about a softening labor market.
The rate cut is likely to generate opposition among policymakers, as inflation pressures remain above the Fed's 2% target.
Impact on Crypto Markets
A dovish Fed could boost risk assets like Bitcoin, with some analysts predicting a price target of $120,000-$130,000.
Lower interest rates make Bitcoin more attractive compared to cash and bonds.
Institutional demand remains mixed, with Strategy Inc. adding more BTC to its holdings, while US-listed spot Bitcoin ETFs saw a modest outflow
Takeaways
The Fed's rate cut decision will likely drive market volatility.
Bitcoin's price is sensitive to macroeconomic instability and regulatory uncertainties.
Institutional adoption and macroeconomic tailwinds provide a floor for Bitcoin's price action
