In brief
- Bitcoin ended the month with a 6.47% loss, despite reaching a record high of $124,545.60.
- Experts are closely watching jobless claims, U.S. productivity, and the August jobs report that could influence the Fed’s September rate cut decision.
- A weak jobs report could counterintuitively be a positive catalyst for Bitcoin, according to experts who remain cautious due to September’s bearish seasonality.
Bitcoin extended last week’s correction, closing the month on a negative note, with experts awaiting key macroeconomic data that could shape the U.S. Federal Reserve’s upcoming rate cut decision.
The spotlight is on the trifecta of jobless claims, U.S. productivity, and the August jobs report as the Fed faces conflicting data points with rising inflation and a weakening jobs market.
“The Fed is walking a tightrope,” Kurt S. Altrichter, founder of Ivory Hill Wealth Advisory, said in an X post on Sunday. Cutting rates “too soon risks reigniting 1970s-style inflation,” while holding them steady could “trigger a recession” by breaking the labor market, Altrichter added.
The pressure on Chair Jerome Powell, as a result, is immense, making this week’s data releases more critical than usual.
All eyes are now on Thursday’s initial jobless claims, which track new applications for unemployment benefits.
While the consensus forecast of 230,000 claims aligns with the prior week’s 229,000, a reading above this threshold would signal a further softening of the labor market and add significant pressure on the Fed to consider slashing interest rates.
Following closely on the same day is the final revision of U.S. Productivity and Unit Labor Costs.
The preliminary Q2 2025 productivity growth is set at +2.4% quarter-over-quarter annualized, with unit labor costs at +1.6%, down from the first quarter’s 6.9%, according to the August report.
A downward revision in productivity or an upward revision in unit labor costs would raise concerns about persistent inflationary pressures, as higher labor costs per unit of output could signal wage-driven price increases.
Friday’s Unemployment Rate and Nonfarm Payrolls forecasts peg the unemployment rate at 4.3%, up from July’s 4.2%, with payrolls adding 75,000 jobs, up slightly from July’s 73,000 and wages up 0.3% month-over-month.
“We expect payrolls to come in below consensus, around 40,000–60,000 versus 75,000 expected, with unemployment likely rising to 4.3%” Xu Han, director of Liquid Fund at HashKey Capital, told Decrypt.
He cautioned that hiring is weakening gradually, but the markets may be “underestimating the risk of larger layoffs ahead,” a scenario that could push the Fed toward not just a single 25-basis-point cut in September, but “a series of cuts beyond” into late 2025.
This perspective is counterintuitive as it suggests that a weaker growth and employment report might not be a negative for Bitcoin.
Instead, it could provide the clarity investors need on the Fed’s rate path, acting as a green light for risk assets like Bitcoin by boosting expectations of looser monetary policy and increased liquidity.
Regardless, experts remain cautious of Bitcoin due to bearish September seasonality.
“As we enter a more volatile September—typically the weakest seasonal month—with Bitcoin trading near a fragile equilibrium, we recommend focusing on the medium short-term holder cost basis,” Han said.
Bitcoin ended August with a 6.47% loss and is currently trading at $107,500, according to CoinGecko data.
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