July jobs report expected to show a labor market slowing to a crawl
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Yahoo
8 minutes ago
- Yahoo
The Fed Announced Interest Rates Will Hold Steady. Here's How That Could Affect Crypto Prices for the Second Half of 2025.
Key Points The Federal Reserve opted not to change interest rates on July 30. Cryptocurrencies supposedly tend to perform better when rates are lower. The crypto bull market isn't about to lose speed as a result of this decision. 10 stocks we like better than XRP › The Federal Reserve just left its benchmark rate frozen between 4.25% and 4.5% for a fifth straight meeting, at its July 30 vote. In a rare occurrence, Governors Michelle Bowman and Christopher Waller departed from their colleagues and voted for a 25-basis-point trim, the first time two board members have broken ranks in the past three decades. Cryptocurrency investors love to read the Fed's tea leaves. Cheap money buoyed past bull runs, and tight money cooled them -- or so the narrative goes. Yet the digital asset market of 2025 is riding a different set of engines, many of which run just fine without monetary octane. Here's how the move is likely to affect the sector. Steady rates are only half the story To recap, the Fed sets the prime interest rate, which in turn affects the cost of borrowing money. Lower rates mean that money is cheaper to borrow, which tends to have the effect of juicing the financial system with more cash. They also mean that there's a lower payout from government-issued bonds, which are typically considered to be the safest. As a result, investors tend to be incentivized to chase riskier investments (like crypto) as safe yields become unattractively low. This go around, holding rates steady surprised nobody, but the market immediately clipped the odds of a September rate cut to 46%, and it is now questionable whether the rest of the year will feature any rate cuts at all, in contradiction to the market's past expectations on average. That matters because it tightens financial conditions at the margin where the expectation had been for them to loosen. The most important macro element here is that inflation is no longer plunging. June's Consumer Price Index (CPI) readout clocked in at 2.7% year over year, up from 2.4% the month before. The Fed can't slash aggressively while core prices drift up and the inflationary effects of tariffs percolate through supply chains. So the White House's chaotic tariff policies are already having a direct and detrimental impact on the economy, which the Fed is identifying explicitly and responding to. For major crypto coins the takeaway is mixed, at least at first glance. Higher real yields raise the opportunity cost of holding unstaked crypto assets without a yield, such as Bitcoin (CRYPTO: BTC), XRP (CRYPTO: XRP), Ethereum (CRYPTO: ETH), and Solana (CRYPTO: SOL). But individual shifts in the interest rate rarely derail a structural crypto bull phase; recall that 2020's rally began with the Fed on hold. More important is whether liquidity outright contracts. So far, it hasn't. Crypto's own tailwinds matter more here There's reason to believe that the Fed could hold tight on interest rates through the remainder of 2025 and it wouldn't slow down the cryptocurrency sector much. Major capital inflows from financial institutions are the biggest part of the story here. Those institutions are how fresh capital keeps finding on-ramps. Spot Bitcoin exchange-traded funds (ETFs) logged $6.6 billion of net inflows in just 12 trading days through July 19. Demand on that scale insulates prices from modest policy shifts. Network upgrades are stacking up, too. Ethereum executed its Pectra update on May 7, boosting throughput and implementing a few fixes aimed squarely at institutional users. Cheaper, faster blockchain space during an interest rate plateau is still cheaper and faster when rates dip, so rates aren't about to stop institutions from loading up. Meanwhile, Solana currently enjoys 99% odds of winning approval from regulators for a spot ETF before 2026, per prediction markets, and there are already hints of pent-up demand among institutional investors. ETF anticipation acts like an embedded call option on policy easing. If the Fed cuts, Solana's liquidity backdrop improves, but even a pause leaves the ETF catalyst fully intact. Finally, XRP added its own growth lever on June 30 when its new sidechain went live, enabling Ethereum-style smart contracts to tap XRP liquidity in the new structure. The sidechain does not care whether the fed funds rate is at 4.5% or 4.25%; it cares about developer migration and transaction volume, which will likely occur to at least some degree regardless of what the cost of borrowing money is. Put together, the sector's narrative at the moment looks strong, regardless of macro conditions. Yes, a pair of rate cuts would likely bolster sentiment and increase the appetite for risk, but investors betting solely on easier policy are ignoring the real engines that are running now, which are cash and developer talent continuing to migrate on-chain with speed. Practical positioning for the back half of 2025 boils down to discipline. In that respect, it's sensible to dollar-cost average (DCA) rather than chase headlines -- and to steer clear of coins that lack clear upcoming catalysts. Should you invest $1,000 in XRP right now? Before you buy stock in XRP, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and XRP wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $625,254!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $1,090,257!* Now, it's worth noting Stock Advisor's total average return is 1,036% — a market-crushing outperformance compared to 181% for the S&P 500. Don't miss out on the latest top 10 list, available when you join Stock Advisor. See the 10 stocks » *Stock Advisor returns as of July 29, 2025 Alex Carchidi has positions in Bitcoin, Ethereum, and Solana. The Motley Fool has positions in and recommends Bitcoin, Ethereum, Solana, and XRP. The Motley Fool has a disclosure policy. The Fed Announced Interest Rates Will Hold Steady. Here's How That Could Affect Crypto Prices for the Second Half of 2025. was originally published by The Motley Fool Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
New York Post
10 minutes ago
- New York Post
Ernst highlights a major problem: Cost overruns are no big thing in Washington
Federal Reserve chief Jerome Powell should be thanking Sen. Joni Ernst: The cost overruns her team dug up on mismanaged government projects make the Fed's renovation overspending look almost modest. On Wednesday, Ernst's office released a report detailing nearly $163 billion in overruns on more than a dozen infrastructure projects, urging Congress to claw back $13 billion in allocated funds. The biggest money-sucker is California's high-speed rail boondoggle, which was supposed to connect San Francisco to Los Angeles by 2020 on a $33 billion budget when it first passed back in 2008. Advertisement On Wednesday, Rep. Joni Ernst's office released a report detailing almost $163 billion in cost overruns on more than a dozen infrastructure projects, urging the federal government to claw back $13 billion in allocated funds. AP The end is far out of sight after years of delays thanks to absurdly optimistic planning, bad decisions and red tape: The very first track was only laid this past January; the latest projections have it costing $128 billion with completion more than a decade late. In the highly unlikely event it gets finished at all. The Trump administration rightly nixed $4 billion set aside for Cali's 'train to nowhere'; not another red cent of taxpayer dough should be flushed down that black hole. Advertisement Another major cash waste is the Department of Veterans Affairs' effort to transition to an electronic health record system, now running a cool $33.7 billion over budget. And Ernst lists plenty of smaller financial fiascos that prove overruns are the norm when it comes to government work. That includes an attempt to resurrect the LIRR's Rockaway Beach line, the tab for which has ballooned to $1.4 billion — more than three times the $400 million it was supposed to cost. Advertisement Meanwhile, the Camden Direct Connection Project in New Jersey, meant to reduce traffic and improve highway conditions, has ballooned from an $873 million job finishing in 2021, to (so far) $1.2 billion in work that won't finish 'til 2032. Fact is, most of these projects were boondoggles from the start — half-baked ideas that never should've gotten started. Advertisement No wonder the Fed's Powell shrugged off the extra $600 million for a $2.5 billion headquarters revamp when testifying to the Senate Banking Committee. Good on Ernst for drawing attention to this dysfunction: The first step is admitting you have a problem. But nothing will change unless Congress stops allocating federal funds for pipe-dream projects that suck up public cash for years with nothing to show for it.
Los Angeles Times
10 minutes ago
- Los Angeles Times
A raging Trump digs in on his trade war after brutal jobs report
WASHINGTON — The Trump administration is doubling down on its trade war against much of the world despite increasingly harrowing economic numbers emerging at home, with stock markets and Treasury yields tumbling Friday on news of the most significant slowdown in job growth since the pandemic. Government data showed the U.S. economy added 73,000 jobs in July — far fewer than expected — and issued revised numbers for the prior two months that showed only 19,000 jobs were created in May, and 14,000 in June, amid widespread uncertainty over President Trump's tariff policies and deep cuts to government employment. The unemployment numbers came a day after Trump signed an executive order increasing tariffs on 66 countries, further roiling a decades-old system of global trade. The chair of the White House council of economic advisors reacted to the unemployment report by saying the numbers are 'not what we want to see.' But Trump responded by directing his team to fire the commissioner of the Bureau of Labor Statistics, an ostensibly nonpartisan position responsible for overseeing the statistical analysis of jobs data, suggesting the numbers were politically 'manipulated.' She was fired hours later. 'I was just informed that our Country's 'Jobs Numbers' are being produced by a Biden Appointee, Dr. Erika McEntarfer, the Commissioner of Labor Statistics, who faked the Jobs Numbers before the Election to try and boost Kamala's chances of Victory,' Trump wrote on his social media platform, Truth Social. McEntarfer was confirmed by a Senate vote of 86-8 in January 2024. He did not offer evidence to support his accusations of manipulated data, either for this year or before the 2024 election. 'We need accurate Jobs Numbers. I have directed my Team to fire this Biden Political Appointee, IMMEDIATELY. She will be replaced with someone much more competent and qualified. Important numbers like this must be fair and accurate, they can't be manipulated for political purposes.' Paradoxically, Trump and his team also seemed to acknowledge the authenticity of the numbers by blaming the chair of the Federal Reserve, Jerome Powell, for the unflattering results. For months, Powell has resisted pressure from Trump to lower interest rates amid concerns over stubbornly high inflation — and the prospect that prices will increase further if the president's trade war persists. The Federal Reserve chairmanship is another position meant to operate with independence. 'Inflation has cooled, wages have increased, unemployment is stable, and the private sector is growing,' Karoline Leavitt, the White House press secretary, said in a statement to The Times. 'President Trump's America First agenda has ensured new jobs go to American citizens, instead of illegals or foreign-born workers. The tariffs are raking in billions of dollars to make our country wealthy again. Jerome 'Too Late' Powell needs to cut rates so our economy can continue to boom.' At the closing bell, the Dow Jones industrial average had fallen over 500 points, while the NASDAQ was down over 2.25%. The U.S. dollar fell against other currencies. But the most telling moves may have occurred in the bond market, which saw the most drastic slumps in 10-year and two-year Treasury yields in a year. The increased unemployment rate, to 4.2%, came off government data reported earlier in the week that showed a dramatic decrease in imports and consumer demand to the United States, figures that have temporarily inflated economic growth numbers. Overall, economists are warning that U.S. gross domestic product could grow less than 2% this year, its worst performance since the height of the pandemic. Trump has had issues with unemployment data for many years, often using one of his favorite terms, 'fake,' to describe them. During his 2016 campaign, he argued that unemployment was worse than the government figures showed; once in the White House, he suggested the official data understated the strength of the economy. The timing of the latest jobs report comes at a politically inopportune moment for Trump, who had set Friday as a deadline for countries around the world to negotiate trade deals with the United States on his terms, or else face steep tariff rates. Only a handful of framework agreements were struck — with the European Union, South Korea, Japan, the United Kingdom and Vietnam, among others — while dozens of other nations were hit with rate hikes. Major trading partners faced brutal increases, including Brazil, which now faces a 50% rate on most goods, and India, hit with 25% import duties. Switzerland was slammed with a 39% rate, but most countries on the list released by the White House were given 15% tariff rates. The new import taxes are to take effect Aug. 7. Economists have warned since April 2, when Trump declared 'Liberation Day' from a global system of free trade, that his new policies would devastate the U.S. economy, raising prices and slowing growth in the short term while depressing living standards for years to come. 'The good news,' Trump wrote on Friday, 'is that Tariffs are bringing Billions of Dollars into the USA!' Tariff discussions remain unresolved for Canada and Mexico, two of the United States' largest trading partners. Though Trump said this week that Friday was a firm deadline and would not be extended, on Thursday he said new tariffs on some Mexican goods would be delayed 90 days while the two countries continue to negotiate. Canada, on the other hand, remains at an impasse with the president over his demands. 'We will continue to negotiate with the United States on our trading relationship,' Mark Carney, Canada's prime minister, said in a statement, but, 'the Canadian government is laser focused on what we can control: building Canada strong.' 'We can give ourselves more than any foreign government can ever take away,' he added.
