Risks Are Skewed to a Weaker Nonfarm Payrolls Print, ING Says

ING analysts are warning that Friday’s U.S. nonfarm payrolls report may fall short of expectations, potentially prompting a surge in volatility across financial markets, including cryptocurrencies. According to economists polled by the Wall Street Journal, the U.S. economy is expected to have added 185,000 jobs in July, down from June’s figure of 206,000. However, ING suggests that evidence from other employment surveys indicates that there is a higher chance of a weaker payrolls print. If the report does come in weaker, it is likely to increase expectations of Federal Reserve interest-rate cuts, which could diminish the appeal of the U.S. dollar and potentially boost demand for riskier assets such as bitcoin. Traders are already anticipating rate cuts in September, despite Fed Chairman Jerome Powell’s recent statement ruling out significant decreases. ING analysts believe that once equity turmoil and geopolitical tensions subside, macroeconomic forces could drive the dollar lower and further support cryptocurrencies. Bitcoin has already experienced a recovery ahead of the payrolls report, with analysts predicting that the imminent rate cut could push the cryptocurrency to new highs.