U.S. July Jobs Data Sparks Fed Rate Cut Speculation as Bitcoin, Stocks Slide

U.S. labor market data released Friday revealed the weakest three-month employment growth since the 2020 pandemic shutdowns, with July’s soft jobs report compounded by downward revisions to June and May figures. The surprising slowdown is fueling expectations that the Federal Reserve, led by Chair Jerome Powell, could resume interest rate cuts at its September meeting.

Bond markets reacted swiftly, with the 10-year U.S. Treasury yield plunging 14 basis points to 4.22%. Gold prices surged 1.5% to $3,400 per ounce, nearing record highs, as investors sought safe-haven assets.

However, risk markets tumbled. The Nasdaq dropped 2.5% late in the session, while Bitcoin (BTC) slid over 3% to $113,800. Ether (ETH), Solana (SOL), BNB, and Dogecoin (DOGE) saw sharper losses of around 6%. XRP (XRP) showed relative resilience, falling just 2.9%.

Political tensions flared as President Donald Trump blasted Powell on Truth Social, labeling him “Jerome ‘Too Late’ Powell” and demanding immediate rate cuts. Trump also accused Labor Statistics Commissioner Erika McEntarfer of manipulating data to favor the previous administration, intensifying scrutiny over economic reporting.

Crypto-related stocks mirrored the selloff. Coinbase (COIN) plunged nearly 18% following disappointing earnings, while Robinhood (HOOD) fell 3.1%. Bitcoin miners Riot Platforms (RIOT) and MARA Holdings (MARA) dropped 17% and 3%, respectively. Stablecoin issuer Circle (CRCL) and Bitcoin-treasury giant Strategy (MSTR) both declined about 7.5%.

The sharp divergence between safe-haven assets and risk markets highlights growing recession fears and the potential pivot in U.S. monetary policy. All eyes now turn to September’s Fed meeting, where rate decisions could set the tone for both traditional and crypto markets heading into the fourth quarter.