The employment figures in the U.S. came in far below expectations, causing some shifts in Federal Reserve forecasts. The market now expects a 99.5% probability that the Fed will cut interest rates by 25 basis points at its meeting on November 7, with almost no chance of no cut. October saw only 12,000 new jobs added to the workforce, compared to expectations of over 100,000. Despite this large shortfall, the market does not view it as a recession warning. The CME FedWatch Tool, which reflects futures market expectations, still suggests a 25 basis point rate cut is highly likely, with only a 0.5% chance of no action. There are currently no expectations for a larger, 50 basis point cut.
President Joe Biden attributed the employment dip to recent disruptions, including a major storm in Florida and port worker strikes. He expressed optimism for a rebound in November. Meanwhile, Bitcoin showed no significant reaction to the employment or unemployment figures, which held steady at 4.1%.