Bitcoin could rise due to a weaker job market, but Bitcoin ETFs are on track for their third consecutive week of net negative outflows.
Bitcoin and other risk assets might benefit from a weakening job market and increasing unemployment in the United States, the world’s largest economy.
The unemployment rate in the United States increased to 4.1%, surpassing the previously anticipated 4.0% and reaching its highest level since December 2021.
The U.S. economy added 206,000 jobs in June. While this is above the expected 191,000, it is considerably lower than the 272,000 jobs added in May, which was subsequently revised to 218,000, according to the nonfarm payroll data published by the Bureau of Labor Statistics on July 5.
A weakening labor market in the United States could be a positive catalyst for Bitcoin’s price, according to Jag Kooner, the head of derivatives at Bitfinex. Kooner explained that if job growth is weaker than expected, it could increase expectations for future rate cuts, which might bolster Bitcoin prices as investors seek alternative assets in anticipation of a looser monetary policy.
Bitcoin has been in a downtrend for over a month, falling below the significant $60,000 mark. This trend has coincided with Bitcoin ETFs experiencing three weeks of net negative outflows.
Summary Review: While a weaker job market might create a favorable environment for Bitcoin as investors look for alternative assets, the cryptocurrency still faces significant challenges, including sustained downward pressure and ETF outflows.
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