The Last Market Focus Prior to March FOMC Meeting

Keep a very close on the crucial US labour market data in Feb, to be released this afternoon at 13:30 GMT. It includes non-farm payroll headline and revision figures, unemployment rate and average hourly earnings.

Apart from the significant non-farm payroll figure, we also need to pay attention to other labour market data to obtain a broader scope of the overall labour market performance.

The US labour market data in Feb is the last variation and market focus for a potential rate hike, before the upcoming FOMC Mar 14-15 meeting.

Last week 7 out of 10 FOMC members have made a hawkish comment. Noticeably, the Fed doves, the Chair Yellen and the FOMC permanent voting member Brainard, both made a hawkish speech.

The market expectations on a Mar rate hike have been largely priced in since Fed. Per the CME’s FedWatch tool the current probability of a rate hike in Mar has jumped to 88.6%.

The average figure of non-farm payroll in the past 6 months is around 189K, which is similar to the 190K estimate in Feb. If the upcoming NFP figure outperforms or is in line with expectations, then we can expect a probable rate hike in Mar. However, if it is lower than 140K, then it will likely moderately lower the probability of a rate hike.

Be aware that according to past experience, the market trends sometimes reverse within 1-2 hours after the initial move.

Did you know?

In terms of trading volume, the FX market is by far the largest market in the world.

Word of the day
"Boiler Room" - Initially used in reference to fraudulent brokerages set up with the purpose of offloading unwanted securities of the firm’s owners, the term is now synonymous with companies that employ high-pressure selling tactics while also misrepresenting the products that they offer.
Pro Tip

There is no get-rich-quick formula. If someone promises you one, take a step back, and then run as far away from them as possible.

UP