065 – What a difference a week makes in the markets

<p>Last Week:</p> <p>· NFP 517K vs 190K forecast.</p> <p>· Unemployment 3.5%--&gt;3.4%</p> <p>· Wage data came in as forecast at 0.3% m/m.</p> <p>· PMI non-manufacturing data is strongly back above 50.</p> <p>· Fed raises rated by 25bps on Wed.</p> <p>· Hawkish but more relaxed.</p> <p>· Powell talked about the disinflation process.</p> <p>· Did not validate December projections.</p> <p>· Offered little push back against the market.</p> <p>· Opened the door to potential pivot (in case of overshoot).</p> <p>· Following NFP, terminal rate is pushed back one month, and markets sees 5.25%.</p> <p>· Employment coming back into focus: will unemployment increase.</p> <p>· ECB: raised by 50bps and committed to another 50bps in March in statement.</p> <p>· Intentions are to hike passed March.</p> <p>· President Lagarde acknowledged more balanced risks to inflation outlook.</p> <p>· ECB likely more hawkish than Fed.</p> <p>· BoE: No surprises but unclear guidance.</p> <p>· Softened communication but didn’t signal pause.</p> <p>· Comment – may be at the turning point but not necessarily done.</p> <p>This week:</p> <p>· Powell: moderated discussion Economic Club of Washington (Tuesday).</p> <p>· RBA cash rate: &nbsp;25bps after recent inflation surprise?</p> <p>· Williams (NY Fed president) interview with Nick Timiraos on Wed.</p> <p>· UK GDP on Fri.</p> <p>· China/US relations are strained after US shoots down “spy” balloon.</p> <p>· Tech Earnings: BP, Disney. Last week Meta, Amazon, Alphabet, Apple.</p>