Australia PM Turnbull confirmed on Friday that Australia will be exempted from steel and aluminium tariffs. (Newswires)


Fitch affirmed Hungary at BBB-; Outlook Positive. (Newswires)


USD: DXY is flat on the week, trading around 90.10, though finishes the Friday down. It was a choppy pre-market, with the buck snapping higher on the headline payroll beat (313k was above the most optimistic forecast), though tumbled back down after average hourly earnings data fell to 2.6% YY from a revised down 2.8%. Meanwhile, specs have raised their long USD bets to a four-week high (week ending 6/Mar), CFTC/Reuters reported.

CAD: The Loonie closes out the week near highs against the US dollar slightly above 1.28; CAD has broken through the weekly range (1.2850 to 1.3025 this week) after the jobs report data provided traders relief that the sharp declines seen in January have not been repeated in February (slightly less jobs added, but unemployment slipped while participation was stable). There is only a slim chance of a hike at the April BOC, so the focus remains on the NAFTA trade negotiations, which have seemingly tuned for the better for Canada and Mexico.

EUR: Action was dictated by the USD, the net effect on the day was neutral, with EUR closing out the week near 1.23, slightly lower on the week. It was similar for the JPY, which has been lingering around the 106.80 level after a dovish BOJ overnight, moving in a thin range through European and US trade. GBP, meanwhile, is about 0.3% stronger on the day against the EUR and the USD.


US Baker Hughes Total Rig Count (9 Mar) 984 (Prev. 981). (Newswires)
US Baker Hughes Oil Rig Count (9 Mar) 796 (Prev. 800)
US Baker Hughes Gas Rig Count (9 Mar) 188 (Prev. 181)

OPEC is reported to be divided regarding views on the right price of oil with Iran said to prefer USD 60/bbl, while Saudi Arabia would prefer prices to be at USD 70/bbl. (WSJ)


US President Trump claimed on Friday that a deal with North Korea is in the making, while he added that time and place for leaders meeting is yet to be determined. (Newswires)

White House Press Secretary Sanders said President Trump will not meet with Kim Jong Un until concrete steps have been taken. (Newswires)



Fed’s Bullard (Voter, Dove) reiterated that 4 hikes this year could slow the economy. (FT)

Fed’s Evans (Non-voter, Dove) said that periods of inflation above 2% would likely generate in most new frameworks under discussion. (Newswires)

Fed’s Rosengren (Non-voter, Hawk) said 4 rate hikes are likely needed this year, while he added that he expects inflation to firm and upward pressure on wages in 2018. (Newswires)

US President Trump is firmly considering White House Strategic Initiatives Director Liddell as Gary Cohn’s replacement. (NYT)

US President Trump lawyers were reported to be in early stage discussions with Special Counsel Mueller for a deal to quicken an end to the Russia probe. (Newswires)

Mexico’s NAFTA negotiator Guajardo believes there is a 60% chance of a successful NAFTA agreement and states NAFTA talks could be wrapped up before Mexico’s election in July. (Newswires)

Data Recap
US Non-Farm Payrolls (Feb) 313k vs. Exp. 200k (Prev. 200k, Rev. 239k). (Newswires)
US Unemployment Rate (Feb) 4.1% vs. Exp. 4.0% (Prev. 4.1%)
US Average Earnings (Feb) 2.6% vs. Exp. 2.8% (Prev. 2.9%, Rev. 2.8%)


Major equity indices surged after the February employment situation report showed that headline payroll growth was solid, though easing average hourly wages hint that inflation pressures may not be so aggressive. The result was a “goldilocks,” friendly environment for stocks, and equities stayed at higher levels, with the EMINI rising to over 2780. In the background, risk was also supported by positive developments on the Korean peninsula, while the tariffs announced by the Trump administration on Thursday as certainly more benign than had been feared. SPX +1.7%, DJI +1.7%, Nasdaq Comp +1.8%.

Bear-steepening was the theme for Treasuries, but the yields were only 1-3bps higher across the curve. Perhaps the most interesting thing about the TPLEX was that, despite equity traders seeing the dovish side of the employment report, the bond traders didn’t entirely agree, and the March T-Note futured settled around 4 ticks lower than pre-NFP levels.