Payroll Data Smashes Estimates

US nonfarm payrolls released on Friday beat estimates after substantially disappointing ADP figures and Challenger Job Cuts. The latest figure showed the US economy added 295,000 jobs in February despite poor weather conditions and rising layoffs in the energy sector. The majority of gains came from sectors that have lower salaries and wages which is why average hourly earnings failed to meet expectations of a 0.20% gain month over month. More concerning was the drop in the labor force participation rate which fell to new multi-decade lows. The dollar shrugged off this point, hitting new multi-year highs and causing a precipitous drop in gold prices which fell 2.7% following the announcement. Traders are meanwhile moving up forecasts for higher interest rates as the data remains supportive of medium-term hike.

After weeks of back and forth between the Greek Administration and Euro Area finance ministers, Greece is struggling to come up with the funding necessary to stave off a default. Important repayments to the IMF are due this week with limited options for funding the obligations. If Greece fails to unlock another €7 billion from an earlier bailout arrangement, probability is high that the nation will default on upcoming payments. Although the Government submitted reform proposals to the Euro Group and other creditors, they were dismissed with disappointment and frustration. The Euro has been sent lower on concerns that Greece will not find an imminent solution and the kickoff of the ECB’s quantitative easing program.