POWER: Engie, Imerys Sign PPA in Spain

• Treasury futures gap higher then retrace - still off early lows after BLS Prelim Benchmark Revision to Establishment Survey Data comes out much lower than anticipated.
• Currently, the Dec'25 10Y trades -4.5 at 113-13 (yld 4.0665 -.0267) vs. 113-10.5 low -- Initial firm support to watch is 112-11+, the 20-day EMA.
• Curves mixed: 2s10s -0.154 at 54.988, 5s30s +1.394 at 114.346.
• US$ off lows, BBG index BBDXY currently +0.72 at 1199.27 vs. 1196.69 post data low.

• The BLS preliminary estimate for the annual payrolls benchmark revision points to a downward revision of -911k over the twelve months up to March 2025.
• Analyst estimates were wide-ranging but we estimated a median of -750k, mainly in a range of -500k to -1mn (sometimes given as a similar range by each analyst, for example Goldman Sachs saw between -550k and -950k) but with Barclays more pessimistic still with -1.1-1.3mn.
• This compares with last year’s preliminary estimate of -818k before the -598k in the actual benchmark revision published with the January monthly payrolls report released in February.
• Taking these revisions at face value (which history suggests is likely overly negative), the average pace of monthly payrolls growth of 147k in the twelve months to Mar 2025 would have been 71k.
• As for private payrolls, the -880k preliminary downward revision implies average monthly private payrolls growth would be revised down from 122k to 49k.
• Beware extrapolating this monthly downward revision to the three-month average in seasonally adjusted payrolls growth of 29k as of August (private payrolls also 29k), but the risk is certainly on payrolls growth to have been even weaker than currently estimated.

Greenback snaps lower on the benchmark revision - however -911k is within the scope of expectations and may be limiting the fresh dovish impulse for markets: EUR/USD is back to trade either side of 1.1750 while USD/JPY's initial move toward earlier 146.31 lows is quickly reversed.

• A similar picture in the US curve: US 10y yields edged to new lows, but are back above 4.0550% in short order.