- Bitcoin prices and the stock market declined after the release of strong U.S. employment data. Bitcoin prices and the stock market declined after the release of strong U.S. employment data.

The report pointed to increasing investor concern that the strength of the economy could delay the Federal Reserve's interest rate cuts. While strong employment data is usually a positive indicator for financial markets, current market trends seem to favor monetary easing over signs of economic resilience.

The company stated: "When the Federal Reserve made its first interest rate cut in 2025, it was specifically due to a weak labor market," adding that the cut was not because inflation had reached the Federal Reserve's 2% target.

Concerns grew after recent labor market data questioned the prevailing narrative of an economic slowdown. A message from Kobesi indicated that available jobs in the United States increased by 731,000 in April, reaching a total of 7.6 million jobs, the highest since May 2024.

As a result, traders sharply revised their expectations for monetary policy. The report added that markets now see an increased likelihood of further interest rate hikes through 2027, representing a significant shift from last year's expectations of multiple rate cuts.

Kobesi's message stated: "We have seen a hawkish shift in Federal Reserve expectations since the stimulus package following the pandemic. The baseline scenario indicates a rate hike twice by early 2027."

Changing interest rate expectations have increased pressure on cryptocurrency markets, which are heavily influenced by liquidity conditions and investor risk appetite. Bitcoin remains affected by macroeconomic data, having fallen more than 53% from its October peak, recording significant losses over the past week.

Kobesi's message also read: "Bitcoin has dropped 20% this week alone, with cryptocurrencies wiping out nearly $2.5 trillion since October 2025. The bearish market gained momentum this week and wiped out risk appetite."

The report also pointed to several factors affecting both stock and digital currency markets simultaneously. These include plans by major tech companies like Meta to raise large amounts of capital for AI investments.

Other factors include the upcoming initial public offering of SpaceX valued at $75 billion, which could absorb significant market liquidity.

Bitcoin is currently trading at $60,720, down 2.8% in the past 24 hours.
$BTC