Unemployment Ticks Up to 4.3% as U.S. Economy Adds Just 22,000 Jobs in August

Weak August Jobs Data Raises Odds of Deeper Fed Cut

Disappointing labor market figures for August have bolstered expectations that the Federal Reserve will move ahead with a rate cut later this month, with the possibility of a 50-basis-point reduction now entering the discussion.

Nonfarm payrolls increased by only 22,000 in August, the Bureau of Labor Statistics said Friday, far short of economist projections of 75,000 and below July’s revised 79,000 gain. Alongside a modest 6,000 upward revision to July, June’s jobs total was lowered by 27,000 to negative 13,000—the first monthly decline since the 2020 pandemic shutdowns.

The unemployment rate climbed to 4.3%, matching forecasts and up slightly from 4.2% in July. Average hourly earnings advanced 0.3% on the month and 3.7% year-over-year, both consistent with estimates.

Markets reacted immediately. Bitcoin rose about $500 to trade near $112,800 following the release, while gold jumped more than 1% to a record high of $3,644 per ounce. Equity index futures built on earlier gains, the dollar weakened, and the 10-year Treasury yield slipped six basis points to 4.11%.

50-Basis-Point Move in Play

Bitcoin’s rebound comes after weeks of pressure since hitting a record above $124,000 in mid-August, with lows near $107,400 earlier this week. Even Fed Chair Jerome Powell’s dovish shift at Jackson Hole on Aug. 22 produced only a short-lived bounce.

Until Friday, markets had largely assumed a 25-basis-point cut at the Fed’s September meeting. The softer employment data may shift the debate toward a larger move. Looser policy is generally seen as positive for risk assets, including bitcoin, but if a half-point cut fails to lift sentiment, bullish investors may need to rethink their positioning.