February US Unemployment Report In Sight

The US Bureau of Labor Statistics is forecast to report the addition of 190,000 new jobs last month, while the unemployment rate is expected to edge lower to 4.70% from 4.80%. Wages are also likely to rise 0.30%, a pace higher than the prior month’s 0.10%.

The Federal Reserve will be closely monitoring the labor figures for further reassurance on the strength of the US economy. The past week has seen expectations for a rate hike during the Central Bank’s March 14-15 gathering skyrocket on the back of a string of better-than-expected data points, including the ISM and ADP numbers.

The CME Group’s Federal Funds futures that tracks market expectation for changes in monetary policy, is showing a 90.00% likelihood of a 0.25% increase in the benchmark rate next week.

While most US stock index futures ended Thursday flat, Nasdaq futures have managed to gain ground, trending back towards record highs.

The European Central Bank left its quantitative easing program unchanged as decision makers within the Central Bank try to assess whether the recent spike in inflation will be sustainable. The ECB’s Governing Council reiterated its decision that asset purchases per month will be tapered to €60 billion from April, versus the current €80 billion.

Policymakers also kept the benchmark refinancing rate at 0.00% and the deposit rate at -0.40%, matching consensus expectations. Two years of government bond buying has lifted headline inflation above ECB’s stated target, and calls to cut back on stimulus are mounting. President Mario Draghi has sought to ease those pressures by suggesting that price acceleration is largely on account of higher energy costs, and that political risks, including elections in France and the Netherlands, has the potential to undermine the recovery.

The Euro fell against the US dollar after the decision, and was last trading just below 1.0600.