June 21, 2024
1 Solar System Way, Planet Earth, USA

US jobs data reinforces rate cuts, boosting cryptocurrencies: Nansen analyst

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The US ADP National Employment Report rose by 152,000 in May, below the expected figure of 175,000 and the smallest increase since January. The ADP measures the monthly change in private and non-agricultural employment and a lower than expected result indicates that employment and wage growth are slowing.

Aurelie Barthere, senior research analyst at research firm Nansen, assesses that this result paints a picture of moderating real growth and cooling of the US labor market when combined with other real activity data, such as retail sales. , first quarter GDP and CAPEX.

“As long as growth slows but does not contract, it is likely to lower US rates and become a tailwind for cryptocurrencies. So far we cannot say that the slowdown in growth is too serious,” Barthere added.

Additionally, he mentions the services sector, which remains strong, as evidenced by the latest PMI business survey, and highlights that Jerome Powell has indicated that if unemployment were to rise with rigid inflation, he would prefer rate cuts.

“So investors are pricing in a 'Fed sell' when growth data is weak, but not too weak. “Friday’s payroll is likely to become the next big data point in this narrative.”

A bright June

Crypto industry players expect a “bright June” for the market as reported by Crypto Briefing. Driven by the approval of spot Ethereum (ETH) exchange-traded funds (ETFs) in the US, a jump in the price of ETH may be in store this month.

Additionally, ETH price momentum could spark broad growth in the altcoin market, resulting in a “meme coin summer” as this sector of the cryptocurrency market is showing the same signs of the non-fungible token summer. (NFT) witnessed in 2021. As a result, retail money temporarily drawn from other high-yield projects could flow into cryptocurrencies.

There is also the European Parliament elections, due to be held between June 6 and 9, in which the results could mean a more pro-crypto stance in the European Union, resulting in favorable regulations.

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