Oil surges while bitcoin and equities fall after Trump insists on Iran’s unconditional surrender.

The outlook for the Federal Reserve became increasingly uncertain on Friday as signs of a weakening labor market emerged just as inflation risks appeared to be intensifying.

Risk assets extended their decline early Friday after Donald Trump signaled that prospects for a negotiated settlement with Iran were effectively off the table.

“There will be no deal with Iran except UNCONDITIONAL SURRENDER,” the U.S. president wrote in a post on Truth Social.

The statement rattled markets, pushing West Texas Intermediate crude oil toward a multi-year high near $90 per barrel. Equity futures also moved lower, with contracts tied to the Nasdaq Composite falling about 1.8%. The weakness spread to digital assets, sending Bitcoin down roughly 5% to around $68,800, marking a new session low.

Labor market shows strain

At the same time, fresh economic data pointed to a cooling U.S. labor market. According to a report released by the U.S. Bureau of Labor Statistics, nonfarm payrolls unexpectedly declined by 92,000 jobs in February. The unemployment rate also edged up to 4.4% from 4.3% a month earlier.

The figures underscore a gradual slowdown in hiring that has been developing over the past year.

“Let me put this another way: The U.S. economy has lost jobs since April 2025,” economist Heather Long wrote on X. “Total job gains from May 2025 to February 2026 are now -19,000. Companies are not hiring in the face of all of these headwinds and uncertainty.”

Under normal circumstances, such weak labor market data might push the Federal Reserve toward cutting interest rates. However, policymakers are still contending with inflation that remains above the central bank’s 2% target, and the sharp rise in oil prices risks adding further pressure to the price outlook.

For now, traders in interest-rate markets see little chance of an imminent move. Current pricing suggests just a 4% probability of a rate cut in March and roughly a 17% chance of easing in April.