Financial Markets Daily Report06 February 2023
In the last session of the week, financial markets were very volatile after the upside surprise in the US labor market report for January. Non-farm payrolls rose by 517k, well above consensus expectations (+188k) and the upwardly revised monthly average in 2022 (401k). The unemployment rate ticked down to 3.4%, a level not seen since 1969.
- In the last session of the week, financial markets were very volatile after the upside surprise in the US labor market report for January. Non-farm payrolls rose by 517k, well above consensus expectations (+188k) and the upwardly revised monthly average in 2022 (401k). The unemployment rate ticked down to 3.4%, a level not seen since 1969.
- The report was read by investors as evidence that could push the Federal Reserve to deliver additional tightening. Last week, Jerome Powell signaled two additional 25bp rate hikes are likely.
- In this context, yields on sovereign bonds rose across the board, particularly so in the short end of the US yields curve, stock indices were mixed in Europe and declined in the US and the euro weakened against the US dollar.
- This week is light in terms of economic data releases and the focus will be on the central bank officials’ speeches (e.g. Powell, Williams or Kashkari from the Fed and Holzmann, Knot, de Guindos, De Cos and Schnabel from the ECB).