Key Points:
The U.S. Department of Labor has revised employment numbers down by 911,000, marking the largest decline in history, indicating a deep weakness in the labor market.
This revision has further strengthened market expectations for a Federal Reserve interest rate cut, despite inflation levels remaining high.
The market generally believes that Bitcoin (BTC) is likely to follow the upward trend of gold, regaining momentum in the fourth quarter and aiming for new highs.
The U.S. Department of Labor released the largest employment data revision in history, and Bitcoin (BTC) prices are expected to benefit in the coming weeks. This revision adjusted the previously reported jobs down by 911,000 for the 12 months ending March 2025, with an average monthly overestimation of 76,000 jobs. The scale of the revision even surpasses that during the peak of the 2009 global financial crisis.
Data from the Kobeissi newsletter shows that the job losses were primarily concentrated in consumer-driven sectors, including a reduction of 176,000 jobs in leisure and hospitality, and a decrease of 226,000 jobs in trade, transportation, and utilities. The total employment in the private sector was overestimated by 880,000 jobs, a level of weakness not seen since the Great Depression and the COVID-19 pandemic in 2020.
These revisions have further intensified market concerns about the labor market. Last month, the U.S. revised down employment data for May and June by 258,000 jobs. Yesterday's revision reduced another 27,000 jobs, making the net revision for these two months the largest in modern history outside of 2020. Meanwhile, only 22,000 jobs were added in August, leading the market to be almost certain that the Federal Reserve will cut rates at next week's meeting.
As a traditional safe-haven asset, gold has risen 40% this year, with gold mining companies' profits nearly doubling, a rise about ten times that of the S&P 500 index. Investors are betting that the weakness in the labor market will force the Federal Reserve to take action, even though the core Consumer Price Index (CPI) has rebounded to over 3% and economic growth is close to 3%.
For Bitcoin (BTC), the impact may be even more significant. Bitwise strategist André Dragosch pointed out on social platform X:
The Federal Reserve is expected to cut rates by 25 basis points in 8 days, marking the first time the Fed has cut rates amid high inflation, record stock market highs, and strong GDP. This combination sends a signal that the central bank prioritizes labor market weakness over inflation, creating a "dovish but cautious" tone.
The advantages of Bitcoin (BTC) remain evident. Just as gold had risen months before the policy was implemented, Bitcoin's unique holding structure and high sensitivity to liquidity cycles are likely to transform this rare policy combination into a strong upward catalyst, pushing it to regain momentum in the fourth quarter and aim for new highs.
The analysis platform Tephra Digital previously predicted:
Related: The U.S. Congress requests the Treasury Department to report on strategic Bitcoin (BTC) reserve details.
Original text: “Bitcoin (BTC) Falls on Dismal U.S. Jobs Data, but Q4 Rally to $185K Still Possible”
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