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How Significant Is the January U.S. Jobs Report?

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It's jobs day, the BOJ intervenes, and Trump is said to order a review of Dodd-Frank rules. Here are some of the things people in markets are talking about today.

Jobs day

Economists expect the U.S. to have added 175,000 workers to payrolls in January, and average hourly wages to have grown 2.8 percent from a year earlier. Data are predicted to show that the jobless rate remained at 4.7 percent, when they are released at 8:30 a.m. ET. The new president's plan to create 25 million new positions may face headwinds from the skills shortage in an already tightening jobs market. 

BOJ intervention

The Bank of Japan disappointed and then surprised bond markets overnight. Yields on the country's 10-year bond rose as high as 0.15 percent, after the bank only offered a limited expansion of debt purchases in a regular operation. On the back of the market reaction, the bank offered to buy unlimited amounts of five- to 10-year debt, with their bid-at yields lower than the market rate at the time. Japan's 10-year yield stood at 0.1 percent by 5:25 a.m. ET.

Dodd-Frank review

President Donald Trump will order a sweeping review of post-2008 financial crisis regulations in an executive action today, a White House official said. Trump also plans to halt the introduction of Obama's fiduciary rule, which obliged advisers on retirement accounts to work in the best interests of their clients. Republican lawmakers are already considering a plan for getting the changes through the Senate without requiring a single Democrat vote

Markets mixed

Overnight, the MSCI Asia Pacific Index dropped 0.2 percent while China's Shanghai Composite Index retreated 0.6 percent on the first day of trading after the lunar New Year holiday. In Europe, the Stoxx 600 Index was 0.5 percent higher at 5:39 a.m. ET in a broad-based rally ahead of U.S. jobs data. S&P 500 futures were also gaining

Data Releases

Already today, services PMIs for the euro area and the U.K. showed continuing expansion, even if the British number did disappoint. In the U.S., besides the obvious payrolls data, there are ISM non-manufacturing and factory orders due at 10:00 a.m. ET. A speech from Chicago Federal Reserve President Charles Evans at 9:15 a.m. may also be worth keeping an eye on.

What we've been reading 

This is what's caught our eye over the last 24 hours.

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