Recaps · US payrolls (NFP) · 5 Aug 2022, 13:30 UK
Too strong for crypto
In summer 2022, US GDP had shrunk for two quarters in a row and talk of recession was everywhere. Then the jobs report showed more than half a million new jobs in July. For a market hoping the Fed would ease off, that was bad news.
The report
Payrolls rose by 528,000 in July, more than in any month since February, and June was revised up to 398,000. The unemployment rate fell to 3.5%. The BLS said total employment was now back at its February 2020 level, so all the jobs lost in the pandemic had been regained. A labour market that strong gave the Fed room to keep raising rates fast.
The first hour
Bitcoin was $23,404 at 13:30 UK. It fell almost 1% on the first 5-minute candle and reached its low, about 2.25% down, at 14:10 UK. At the hour it was -1.66%. For a jobs report that is large: #10 of 117 in our data, at 3.6 times a normal hour.
Ether fell further, -2.3% at the hour. Stocks went the other way after the 14:30 UK open: the S&P 500 ETF was +0.9% at the hour and +0.7% at four hours.
| Market | 5m | 1h | 4h | 24h | 1w | × normal hour |
|---|---|---|---|---|---|---|
| Litecoin | −1.14% | −2.25% | −2.06% | −1.57% | −1.91% | 3.2× |
| Ethereum | −1.27% | −2.34% | −2.82% | −0.01% | +9.41% | 4.0× |
| Cardano | −1.15% | −1.98% | −2.20% | −0.28% | +1.19% | 3.6× |
| Bitcoin | −0.86% | −1.66% | −1.78% | −0.80% | +1.51% | 3.6× |
| XRP | −0.51% | −1.42% | −1.94% | −0.72% | −1.35% | 2.0× |
| Chainlink | −0.90% | −1.16% | −0.90% | +2.06% | +18.12% | 1.6× |
Change from the 13:30 UK release, sorted by the first hour.
The pound slipped as well, -0.66% against the dollar at the London 4pm fix, as the dollar strengthened on the strong data. The day before, the Bank of England had raised rates by half a point, its biggest single hike since 1995.
A partial recovery
Crypto bounced in the second hour; at two hours Bitcoin was back to -0.66% and Chainlink was positive. The bounce faded again, and Bitcoin finished four hours at -1.8%. Within a day it was -0.8%.
By the following week the report barely showed. Bitcoin was +1.5% after a week, Ether +9.4% and Chainlink +18%. In our data, this is one of the clearer cases of a strong jobs number hurting crypto in the first hour while helping stocks.
Sources: release time and figures from the U.S. Bureau of Labor Statistics (public domain), first-print values via ALFRED, Federal Reserve Bank of St. Louis. Crypto: Bitstamp 5-minute candles; SPY/QQQ: IEX. No consensus forecasts are shown because they are proprietary; comparisons are with the previous release. “× normal hour” compares the first-hour move with the median move in matched quiet hours. How we measure it.