The change in Nonfarm payrolls for February was 275k, above the 200k estimate. Private Payrolls were 223k (165k estimate) and Manufacturing Payrolls were -4k (7k estimate). Initial market enthusiasm for the better-than-expected headline Nonfarm total quickly soured after the full data set for labor had been released.
December’s Nonfarm payrolls were revised from 353k to 229k (down 124k, a 35% revision). It was no better for Private payrolls which were revised from 317k to 177k (-140k or -44%) and Manufacturing which went from 23k to 8k (a 65% revision). The Unemployment rate increased to 3.9% (a two-year high) vs. 3.7% estimate and prior month. Monthly hourly earnings were below estimate and prior month earnings were revised down.
The dollar is lower against all G10 pairs following the payrolls data with markets interpreting a cooling labor market as reason for the Fed to cut rates sooner. Leading dollar declines: -0.79% vs. JPY, -0.56% vs. GBP, -0.49% vs. NZD, -0.41% vs. AUD, -0.10% vs. EUR and -0.05% vs. CAD.
Treasury yields are lower in the mid-tenors, two-year yields leading -0.055%.
Gold is higher for the 8th consecutive day and notched its 4th consecutive all time high, currently at $2,169.29.
