“The headline nonfarm payroll number at +20K surprised sharply to the downside even as the blow-out January print was revised higher (to +311K),” TD Securities analysts noted.
” Weather distortions may be part of that story. Otherwise, the unemployment rate came back down to 3.8% as household job growth was strong. And wages continue to trend higher: a solid +0.4% m/m increase in February pulled the annual growth rate to a cycle-high of 3.4%. The Fed will remain patient, as they parse the data over the next few months to see if a rebound is underway.”
“Rates: Given the likely weather impact, the strong January payrolls and higher wages, the rate market didn’t react much to the report. The market is pricing in 5bp and 16bp of Fed eases in 2019 and 2020 respectively. We continue to think that the 10y should remain in the 2.6 – 2.75% range with a Fed that should remain patient for now.”
“FX: More noise than it is worth leaves the USD dip shallow. The global macro impulse is sorely lacking leaving king dollar still the champion of the hill. One exception is the JPY; a close below the 200dma should signal bearish momentum.”