📅 November 22, 2025

✍️ Author: Scarlett528


The relationship between the labor market in the US and crypto prices is well established in macroeconomics. It operates through monetary policy, risk appetite, and liquidity expectations.

1️⃣ The labor market affects inflation

When more people are employed:

  • incomes rise

  • expenses rise

  • consumption increases

This may increase inflationary pressure.

2️⃣ Inflation influences the Federal Reserve's (Fed) policy

The Fed monitors inflation and the labor market simultaneously.

When employment data is too strong (more jobs than expected), the Fed may:

  • slow down interest rate cuts

  • or even maintain high interest rates longer

3️⃣ High interest rates reduce liquidity

Higher interest rates make:

  • loans more expensive

  • savings instruments more attractive

  • the cash flow to risky assets decreases

Cryptocurrencies are considered high-risk assets, so they suffer the most when contraction occurs.

4️⃣ Risk appetite affects the crypto market

In macroeconomics, this is called risk-on / risk-off dynamics:

● Risk-on (favorable conditions)

→ investors buy stocks, crypto, technology assets

● Risk-off (uncertainty or higher interest rates)

→ capital is redirected to:

  • dollar (USD)

  • bonds

  • gold

When the US labor market is strong, investors expect the Fed to be more aggressive → risk-off → crypto falls.

5️⃣ Modern crypto markets are closely linked to macroeconomic algorithms

Today's trading is up to 80% algorithmic.

Algorithms monitor data for:

  • Nonfarm Payrolls (NFP)

  • Unemployment Rate

  • Average Hourly Earnings and react within seconds.

Thus, crypto often moves instantly after the release of US jobs data.

🎯 The scientific conclusion

Yes — US jobs data has a direct and significant impact on cryptocurrencies through:

✔ inflation expectations

✔ Fed decisions

✔ interest rates

✔ liquidity in the global financial system

✔ risk appetite

In macroeconomic literature, this is classified as the influence of monetary conditions on speculative assets.

#Binance #USJobsData #RiskOnRiskOff #FOMC‬⁩

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