Rates End Mixed Ahead of February Jobs Report

Rates rangebound ahead of jobs report. Treasury yields and swap rates finally had a quiet day, ending the day mixed across a marginally flatter curve ahead of tomorrow’s crucial jobs report. Equities were down once again, the tech-heavy Nasdaq declining 1.5% to bring its YTD performance to -13.5%. Despite the respite, the MOVE index (a measure of interest rate volatility) remains elevated headed into tomorrow’s nonfarm payrolls report. The jobs report is one of the last major data releases before the FOMC’s rate decision and continued strength in the labor market could renew calls for a 50bp hike.

Crude rally stalls. Oil prices fell today even as Russian crude oil became a de-facto sanctioned asset. The commodity, which has yet to be formally embargoed by NATO countries, is already being avoided in oil markets by participants who don’t want to be seen as funding Russia’s invasion of Ukraine. US crude closed the day at $107/barrel, down modestly from Wednesday’s closing level but still up 45% since the start of the year.

Looking ahead to the jobs report. The Bureau of Labor Statistics’ jobs report will be released tomorrow at 8:30. Current forecasts call for a 420k increase to nonfarm payrolls, while average hourly earnings are expected to increase by 5.8%. The unemployment rate is expected to decrease to 3.9% to match a post-pandemic low.