Recaps · US payrolls (NFP) · 6 Oct 2023, 13:30 UK
Hot headline, calm wages
A headline twice the forecast was the kind of number that, a year earlier, would have hit risk assets hard for the rest of the day. This time the first drop lasted about half an hour. Investors looked past the headline to slower wage growth, and stocks and Bitcoin both turned higher.
- Release
- Friday 6 October 2023, 13:30 UK
- Payrolls
- +336,000 vs 170,000 expected
- Unemployment
- 3.8%
- 10-year yield
- Up to a 16-year high near 4.89% (Reuters)
- Bitcoin at release
- $27,692
The numbers
Employers added 336,000 jobs in September, almost double forecasts, and August was revised up to 227,000. Reuters reported that the 10-year Treasury yield jumped to a 16-year high of about 4.89%. But wage growth slowed, and unemployment held at 3.8%. Reuters and AP reported that stocks fell at first, then rallied as investors focused on wages; the S&P 500 closed 1.18% higher and the Nasdaq 1.6%.
Down for 30 minutes
- 1 14:00 UK: Bitcoin's low, about 1.8% down
- 2 16:50 UK: Bitcoin's high, about +1.3%
Bitcoin was -0.62% after five minutes and reached its low, about 1.8% down, at 14:00 UK. It was -1.01% at the hour, #22 of 117 jobs reports at 2.2 times a normal hour, and +0.73% at four hours. The Nasdaq-100 ETF was +2.36% at four hours. Ether, Solana and XRP each moved about half as much as Bitcoin in the first hour.
| Market | 5m | 30m | 1h | 4h | 24h | × normal hour |
|---|---|---|---|---|---|---|
| Bitcoin | −0.62% | −1.55% | −1.01% | +0.73% | +1.01% | 2.2× |
| Ethereum | −0.38% | −1.08% | −0.48% | +0.41% | +0.45% | 0.8× |
| Solana | −0.23% | −1.57% | −0.57% | +2.19% | +1.69% | 1.0× |
| Chainlink | −0.66% | −1.06% | −1.06% | +1.06% | +0.53% | 1.5× |
| S&P 500 ETF (SPY) | +0.06% | −0.08% | +0.21% | +1.74% | – | – |
| Nasdaq-100 ETF (QQQ) | +0.15% | +0.14% | +0.71% | +2.36% | – | – |
Change from the 13:30 UK release. The ETFs are measured from the 14:30 UK open.
Reading past the headline
The first reaction was to the headline; the second was to the details. When wages are cooling, a strong jobs number is less of an inflation risk, so the case for more Fed hikes was weaker than the headline suggested. Bitcoin bottomed at 14:00 UK, half an hour before US stocks opened, and rose with them through the afternoon.
It fits the pattern of late 2023. After the September report, Bitcoin moved 0.2% in its first hour; after November's, it was 1.2% up at four hours. The Fed held rates at both of the following meetings. The same fade happened on 2 February 2024, after another headline about twice the forecast. For traders, the lesson is that a large first move on the headline is worth less than it looks when the wage numbers point the other way. Bitcoin was -3.0% a week later.
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.