Only 73,000 Jobs Created in July, Pushing U.S. Jobless Rate Up to 4.2%

U.S. Job Growth Slows Sharply, Strengthening Case for Fed Rate Cuts

The U.S. labor market showed clear signs of weakness in July, with job gains falling short of expectations and significant downward revisions to previous months intensifying concerns about a broader slowdown.

Nonfarm payrolls rose by just 73,000 last month, the Bureau of Labor Statistics reported Friday, far below the 110,000 consensus estimate. Adding to the softness, June’s figure was revised down from 147,000 to 14,000, and May’s from 144,000 to 19,000 — leaving the three-month average at just 35,000, the weakest since the early days of the pandemic.

The unemployment rate edged up to 4.2%, matching expectations but rising from 4.1% in June.

The report immediately shifted market expectations. Bitcoin (BTC) rose to $115,800, while the 10-year Treasury yield fell 10 basis points to 4.30%. The U.S. dollar dropped nearly 1% against the euro and yen, reflecting increased bets on Federal Reserve easing.

Earlier this week, the Fed held rates steady at 4.25%-4.50%. Chair Jerome Powell struck a hawkish tone, but Friday’s report may undercut that stance, especially as pressure mounts from both President Trump and Fed Governors Michelle Bowman and Christopher Waller, who both voted for rate cuts.

Following the data, the odds of a September rate cut rose to 55%, up from 40% earlier in the week, according to CME FedWatch.

With economic momentum clearly fading, the weak jobs data may push the Fed closer to policy easing — a shift that could ripple across asset markets heading into fall.