US Nonfarm Payrolls Blow Past Estimates

As rate hike speculation hits fever pitch, a positive employment reading has raised the probability of an imminent rate hike.  The latest figures published by the US Bureau of Labor Statistics showed 235,000 jobs added during the month of February, bringing the unemployment rate to 4.70%.  Two of the surprising drivers were construction and manufacturing hiring for the period.  Although the US dollar fell after the announcement, gold briefly retreated below the $1200 mark before managing to regain the psychological level.  Apart from US data, the European Central Bank unveiled its latest decision, keeping rates and easing measures on hold while taking a more optimistic stance towards risks.

Although the inflation outlook was upgraded, low rates are expected to endure past the expiration of the asset purchase program.  Moving east, Japanese fourth quarter GDP was revised modestly higher, but failed to meet expectations as policymakers warn on growing volatility in the Yen and its impact on exporters.  China also received unwelcome news as inflation dipped to the lowest point in two years, stressing the challenges as officials work to meet Premier Li Keqiang’s ambitious expansion targets.  Finally, oil pressures found themselves under serious strain as growing US production accompanied by rising stockpiles threaten to undo the OPEC output cuts.