This data led to an increase in interest rates, shaking expectations that the Federal Reserve would continue to ease monetary policy. The U.S. labor market gained strength in December, largely beating economists’ forecasts.

The economy added 256,000 new jobs last month, according to the Bureau of Labor Statistics. While this figure significantly exceeded the level predicted by economists as 160,000, it also exceeded the revised figure announced in November as 212,000 (the first announced data was 227,000).

In addition, the unemployment rate decreased to 4.1% in December, below the expectation of 4.2%. In November, this rate was recorded as 4.2%. Strong employment data put general pressure on the markets, reducing expectations for a Fed interest rate cut.

While Bitcoin (BTC) was struggling to recover after serious losses at the beginning of the week, it fell over 2% to $92,800 immediately after the employment report was released.

BTC, which traded at $103,000 at the beginning of the week, had fallen below the $92,000 level at one point on Thursday. Large altcoins, on the other hand, faced larger percentage losses in this process.

This decline in crypto markets was not limited to BTC only. High-performing altcoins also experienced serious losses in value. In particular, investors’ tendency to avoid risky assets caused crypto markets to be among the assets most affected by this period of volatility.

On the other hand, a similar decline occurred in traditional markets. U.S. stock futures fell nearly 1% after the jobs data, while in the bond market, the 10-year Treasury yield rose nine basis points to 4.78%.

The dollar index rose 0.6%, while gold prices fell slightly to just below $2,700 per ounce.

These data led investors to rapidly reduce their expectations that the Fed would continue to cut interest rates throughout 2025. According to CME FedWatch data, the probability of an interest rate cut in March decreased from 41% to 28%, while the expectation of an interest rate cut in May decreased from 44% to 34%.

Another notable economic indicator was the change in hourly earnings. Average hourly earnings increased by 0.3% in December, meeting expectations. However, this figure remained below the 0.4% increase in November.

On an annual basis, hourly earnings increased by 3.9%. This rate was below economists’ expectations of 4% and the 4% level in November.

This fluctuation in crypto markets can be directly associated with the change in investors’ risk perceptions. Expectations about the Fed’s monetary policy continue to determine the direction in the markets.

In particular, the performance of BTC and other crypto assets will be shaped depending on the economic data to be announced in the coming days and investor perception of the Fed’s policies.
This paints a complex picture for market participants. Although data showing strong economic growth provides a positive outlook, rising interest rates continue to pressure crypto markets. It has become clear once again that investors need to pay more attention to risk management in this process.