MNI ASIA OPEN: Global Trade Remains Unsettled, Fed in Blackout

EXECUTIVE SUMMARY

• MNI: Powell Says Fed In No Hurry Amid High Policy Uncertainty
• MNI FED: Powell Doesn't Sound Entirely Convinced About Looking Through Tariffs
• MNI FED: Williams - Longer Than Expected Lag To Inflation Expectations
• MNI FED: Bowman Repeats Neutral Has Likely Risen
• MNI USTR To Hold March 11 Hearing On China Semiconductor Policy
• MNI US-JAPAN: Trade Min To Visit US 9-11 Mar As Trump Questions Bilateral Security Deal
• MNI US DATA: Establishment Survey Sees In Line Payrolls But Weak Hours

US

MNI: Powell Says Fed In No Hurry Amid High Policy Uncertainty

Federal Reserve Chair Jerome Powell said Friday the central bank can take its time before considering any further changes to interest rates as inflation is still above target and policy uncertainty out of Washington remains high. "We are focused on separating the signal from the noise as the outlook evolves. We do not need to be in a hurry, and are well positioned to wait for greater clarity," Powell told an annual monetary policy conference sponsored by Chicago Booth, according to prepared remarks. Powell said the Fed is paying close attention to a recent spike in some measures of inflation expectations. 

MNI FED: Powell Doesn't Sound Entirely Convinced About Looking Through Tariffs

Paraphrased remarks, from the Q&A following his Chicago Booth's 2025 US Monetary Policy Forum address. He does however point to cuts under the first Trump regime and emphasizes the need to take the totality of US policy changes into account. 

MNI FED: Kugler Sees Important Upside Risks To Inflation

Fed Gov. Kugler (permanent voter, center) gives marginally more hawkish remarks, noting “important” upside risks to inflation vs on Feb 20 that upside risks to inflation remain with there being "some way to go". Highlights: “Notwithstanding the well-balanced labor market, there are important upside risks to inflation. Some measures of inflation expectations have risen significantly in the past couple of months, including those from the Michigan survey, the Conference Board, and the Atlanta Fed's survey of businesses.

MNI FED: Williams - Longer Than Expected Lag To Inflation Expectations

NY Fed's Williams (permanent voter, dove) with another more academic speech for this event on monetary policy transmission following Bowman's a little earlier. Full speech here and presentation slides here. "In all cases, there is a lag of about eight months before the shock affects inflation expectations. This is surprising since inflation expectations are forward-looking and should move soon after a surprise,"

MNI FED: Bowman Repeats Neutral Has Likely Risen

• Gov. Bowman (permanent voter, hawk) says the neutral rate has likely risen since the pandemic in a speech on monetary policy transmission. It's not particularly new though, having said for some time that her estimate of neutral is much higher than pre-pandemic (which she said in November, for example).

NEWS

MNI US: Trump Touts Auto Jobs Boom, Says CA Tariffs Could Come Today

US President Donald Trump has touted today’s jobs report as evidence that his trade policy is bringing manufacturing jobs back to the United States. Trump's economic advisor Kevin Hassett, speaking alongside Trump in the Oval Office, argues that manufacturing job are going up out of "expectation for future policy," including tariffs and tax cuts.

MNI USTR To Hold March 11 Hearing On China Semiconductor Policy

The United States Trade Representative has announced that it will hold a hearing on March 11, "regarding the Section 301 investigation on China’s acts, policies, and practices related to targeting of the semiconductor industry for dominance." The hearing details can be found here. The hearing comes after US President Donald Trump suggested in his address to Congress that lawmakers should kill the USD$52 billion Biden-era CHIPS and Science Act - a bipartisan piece of legislation aimed at competing with China in high-end chips.

MNI US-RUSSIA: Trump "Strongly Considering" Russian Sanctions

Latest from Trump on Truth Social on Russian sanctions: "Based on the fact that Russia is absolutely “pounding” Ukraine on the battlefield right now, I am strongly considering large scale Banking Sanctions, Sanctions, and Tariffs on Russia until a Cease Fire and FINAL SETTLEMENT AGREEMENT ON PEACE IS REACHED. To Russia and Ukraine, get to the table right now, before it is too late. Thank you!!!"

MNI SECURITY: BBG-Putin 'Ready To Agree Ukraine Truce w/Conditions"

Bloomberg reports that Russian President Vladimir Putin "is willing to discuss a temporary truce in Ukraine provided there is progress toward a final peace settlement, according to people familiar with the matter in Moscow." The article claims that the offer was put forward in the February meeting between Russia's Foreign Minister Sergey Lavrov and presidential foreign policy aide Yuri Ushanov, and US Secretary of State Marco Rubio, Middle East envoy Steven Witkoff, and National Security Adviser Mike Waltz. 

MNI US-JAPAN: Trade Min To Visit US 9-11 Mar As Trump Questions Bilat Security Deal

The Japanese Trade Ministry has confirmed that Minister of Economy, Trade and Industry Yoji Muto will visit the US from 9-11 March for discussions on bilateral economic ties with senior officials, including Secretary of Commerce Howard Lutnick and US Trade Representative Jamieson Greer. Last week, Muto met with senior representatives from Japan's steel and aluminium industry to discuss the prospect of higher tariffs being imposed on Japanese exports to the US. 

MNI EU: Hungary The Sole Holdout On Ukraine Support At EUCO

As was largely expected, Hungarian Prime Minister Viktor Orbán proved the sole holdout when it came to the EU's joint conclusions on supporting Ukraine at the 6 March special European Council summit. While the EU was able to unanimously back a set of conclusions supporting a major increase in defence spending across the Union, Orbán refused to give his approval to sections regarding increased military support and security guarantees for Ukraine. Instead, the remaining 26 member states backed this section as an 'extract'. 

MNI ISRAEL: Axios-Relations Strained w/US Over Direct Hamas Communication

Axios reports that relations between the Netanyahu gov't and the Trump administration have been severely strained by the news that US officials have engaged in direct conversations with Hamas regarding the potential release of US hostages held in Gaza.

MNI US TSYS: Marking Late Session Lows, Chair Powell's No Hurry Comment Settles In

• Treasury futures have gradually extended session lows since Chairman Powell left the podium. Powell said the Fed is paying close attention to a recent spike in some measures of inflation expectations. Powell reiterated the Fed can take its time before considering any further changes to interest rates as inflation is still above target and policy uncertainty out of Washington remains high.
• The Jun'25 10Y contract currently trades -9.5 at 110-16 - session low, with focus on technical support at 110-12.5/110-00 (Intraday low / High Feb 7); resistance above at 111-15 (Wed's high) followed by 112-01/02 (High Mar 4 / 1.382 proj of Jan 13-Feb 7-12 swing).
• Curves mildly flatter: 2s10s -0.674 at 30.848, 5s30s -0.768 at 51.433. As such, projected rate cuts through mid-2025 cooled significantly vs. morning levels (*) as follows: Mar'25 at -1bp (-2.7bp), May'25 at -9.4bp (-13bp), Jun'25 at -26.3bp (-31.1bp), Jul'25 at -37bp (-42.2bp). Dec'25 had priced in three 25bp cuts this morning now show -69.1bp.
• Cross asset update: stocks have recovered and posting modest late session gains (SPX Eminis +17.0 at 5763.0); Crude firmer but off highs (WTI +.63 at 66.99); Bbg US$ index off morning lows (BBDXY -1.22 at 1268.84).
• Reminder, The Federal Reserve enters policy Blackout at midnight tonight through March 20, the day after the next FOMC annc.

OVERNIGHT DATA

MNI US DATA: Establishment Survey Sees In Line Payrolls But Weak Hours

The establishment survey saw payrolls growth almost as expected, but AHE and in particular hours worked underwhelmed. It’s hard to know what was seen in the report to drive the initial sell-off in Treasuries, beyond pricing had shifted too negative after ADP and even yesterday’s Challenger report with its unusually large reaction. All other details point to at best in line with a few notable weaker aspects. 

• Nonfarm payrolls increased 151k (sa, cons 160k) after two-month net revisions of -2k (of which -18k Jan, +16k Dec), leaving an acceleration from 125k in Jan. There was a similar story for private payrolls, at 140k (sa, cons 145k) after a two-month downward revision of -16k (-30k Jan, +14k Dec) for an acceleration from 81k.
• This new profile of an acceleration relative to January was backed by the one-month diffusion index of private industries bouncing from 52.4 to 58.4% (for context it averaged 53.8% in 2024, 58.8% in 2019). The three-month remains at a healthy 62.0% (55.2% 2024, 61.5% 2019).
• Some federal government layoffs are showing up (but we still think the ~75k on the deferred resignation program won’t have had an impact this month) with federal employment jobs -10k seasonally adjusted for the largest decline since Jun 2022. Total government jobs increased 11k mainly thanks to another 20k net increase in local roles.

MNI US DATA: A Dovish Household Survey Even Allowing For Series Volatility

• The household survey leans dovish, with the unemployment rate nearly rounding to 4.2 with the 4.139% as noted earlier after 4.01% in Jan.  
• Consensus had been for another 4.0% but with a sizeable skew of analysts to a surprise with 4.1%.
• It came despite the participation rate falling more than expected, although rounding exaggerated the move a touch as it dipped from 62.62% to 62.44% (cons 62.6).
• Household employment slumped -588k in the typically volatile survey after what the BLS estimated last month was a 234k M/M increase when adjusting for a huge 2.0m population effect.

MNI US DATA: AHE Unrounded - Feb'25

Total AHE:
M/M (SA): 0.279% in Feb from 0.42% in Jan (initial 0.476%)
Y/Y (SA): 4.024% in Feb from 3.945% in Jan

AHE Non-Supervisory:
M/M (SA): 0.292% in Feb from 0.424% in Jan (initial 0.522%)
Y/Y (SA): 4.112% in Feb from 4.019% in Jan
Source: Bloomberg, MNI

MARKETS SNAPSHOT

Key market levels of markets in late NY trade:
DJIA up 222.64 points (0.52%) at 42801.72
S&P E-Mini Future up 26.25 points (0.46%) at 5773
Nasdaq up 127 points (0.7%) at 18196.22
US 10-Yr yield is up 2.7 bps at 4.305%
US Jun 10-Yr futures are down 5.5/32 at 110-20
EURUSD up 0.0058 (0.54%) at 1.0844
USDJPY down 0.02 (-0.01%) at 147.96
WTI Crude Oil (front-month) up $0.69 (1.04%) at $67.05
Gold is up $0.03 (0%) at $2911.82

European bourses closing levels:
EuroStoxx 50 down 52.06 points (-0.94%) at 5468.41
FTSE 100 down 2.96 points (-0.03%) at 8679.88
French CAC 40 down 76.87 points (-0.94%) at 8120.8

US TREASURY FUTURES CLOSE

3M10Y +2.811, -0.22 (L: -9.708 / H: 1.894)
2Y10Y -1.204, 30.318 (L: 28.424 / H: 33.141)
2Y30Y -1.653, 59.984 (L: 59.177 / H: 64.997)
5Y30Y -0.776, 51.425 (L: 50.607 / H: 56.425)
Current futures levels:
Jun 2-Yr futures down 2.5/32 at 103-14.75 (L: 103-13.375 / H: 103-21.625)
Jun 5-Yr futures down 4/32 at 107-21.75 (L: 107-18 / H: 108-06)
Jun 10-Yr futures down 5.5/32 at 110-20 (L: 110-15 / H: 111-11.5)
Jun 30-Yr futures down 10/32 at 116-26 (L: 116-16 / H: 117-30)
Jun Ultra futures down 16/32 at 122-9 (L: 121-30 / H: 123-25)

MNI US 10YR FUTURE TECHS: (M5) Corrective Pullback

• RES 4: 112-29+ 2.0% 10-dma envelope
• RES 3: 112-13   1.500 proj of the Jan 13 - Feb 7 - Feb 12 price swing
• RES 2: 112-01/02 High Mar 4 / 1.382 proj of Jan 13-Feb 7-12 swing
• RES 1: 111-15   High Mar 5
• PRICE:‌‌ 111-07 @ 1206 ET Mar 7
• SUP 1: 110-12+/110-00 Low Mar 6 / High Feb 7       
• SUP 2: 109-21   50-day EMA and a key near-term support
• SUP 3: 108-21   Low Feb 19
• SUP 4: 108-03+ Low Dec 12 and a bear trigger  

The trend condition in Treasury futures remains bullish and the latest pullback appears corrective. The contract has recently pierced resistance at 111-22+, the Dec 3 ‘24 high. A clear break of this level would strengthen a bullish theme and open 112-02 and 112-13, Fibonacci projection points. Note that the daily trend condition is overbought, a pullback is allowing the overbought set-up to unwind. Firm support is at 110-00, the Feb 7 high.

SOFR FUTURES CLOSE

Mar 25 -0.028 at 95.703
Jun 25 -0.050 at 95.955
Sep 25 -0.055 at 96.190
Dec 25 -0.045 at 96.325
Red Pack (Mar 26-Dec 26) -0.04 to -0.025
Green Pack (Mar 27-Dec 27) -0.025 to -0.02
Blue Pack (Mar 28-Dec 28) -0.02 to -0.015
Gold Pack (Mar 29-Dec 29) -0.015 to -0.01

SOFR FIXES AND PRIOR SESSION REFERENCE RATES
​​​​​​​
SOFR Benchmark Settlements:

• 1M +0.00063 to 4.32221 (-0.00250/wk)
• 3M -0.00245 to 4.29236 (-0.02442/wk)
• 6M -0.00660 to 4.18367 (-0.07308/wk)
• 12M +0.00398 to 3.99933 (-0.12739/wk)

US TSYS: Repo Reference Rates

• Secured Overnight Financing Rate (SOFR): 4.35% (+0.01), volume: $2.558T
• Broad General Collateral Rate (BGCR): 4.34% (+0.01), volume: $975B
• Tri-Party General Collateral Rate (TCR): 4.34% (+0.01), volume: $951B
• (rate, volume levels reflect prior session)

STIR: FRBNY EFFR for prior session:

• Daily Effective Fed Funds Rate: 4.33% (+0.00), volume: $115B
• Daily Overnight Bank Funding Rate: 4.33% (+0.00), volume: $283B

FED Reverse Repo Operation

RRP usage inches up to $136.305B this afternoon from $129.269B Thursday. Compares to $58.770B (lowest level since mid-April 2021) on February 14. The number of counterparties at 33 from 35 prior.

PIPELINE

03/07 No new corporate debt issued Friday after $47.1B total priced on the week

MNI FOREX: Mixed NFP Does Little to Reassure Greenback

• The greenback was sold on the back of a mixed NFP report, which saw headline payrolls growth only slightly below expectations, while the unemployment rate ticked higher to 4.1%. Despite the miss on consensus, Trump's post-jobs report press conference talked up the strength in the underlying data, but did little to overturn the pullback in the dollar: the USD Index consolidates the move to erase the entirety of the election-tripped gains, again favouring EUR/USD to extend the week's winning streak.
• Canadian jobs data came in soft relative to expectations, with the net change in employment at +1.1k vs. Exp. +20.0k, as a sizeable drop in full time employment countered the rise in part time positions. The softer-than-expected report prompted a strong session for USD/CAD, which showed above the 1.4400 handle to partly reverse this week's downside.
• CAD saw another brief phase of additional selling pressure on the back of Trump's post-jobs report comments, who hinted at the possibility of further tariffs - which could come as soon as today, Monday or Tuesday.
• AUD and NZD weakened against most others in G10 as equities spiralled. The tech-led weakness prompted NVIDIA to shed as much as $1 trillion in market cap off the record high, and sees Tesla near half in value off the December high. EUR/NZD rallied sharply - putting the cross north of 1.90 for the first time since the COVID pandemic.
• Focus in the week ahead turns to US inflation, with both CPI and PPI prints due from the US. Importantly, the Fed will be inside their pre-meeting media blackout period, meaning markets could pay greater attention to the prints as a lead-up to the FOMC decision on March 19th. 

MONDAY DATA CALENDAR

Date	GMT/Local	Impact	Country	Event
10/03/2025	0600/1500		JP	Economy Watchers Survey
10/03/2025	0700/0800	***	NO	CPI Norway
10/03/2025	0700/0800	**	SE	Private Sector Production m/m
10/03/2025	0700/0800	**	DE	Trade Balance
10/03/2025	0700/0800	**	DE	Industrial Production
10/03/2025	0900/1000	**	IT	PPI
10/03/2025	-	***	CN	New Loans
10/03/2025	-	***	CN	Money Supply
10/03/2025	-	***	CN	Social Financing
10/03/2025	1500/1100	**	US	NY Fed Survey of Consumer Expectations
10/03/2025	1530/1130	*	US	US Treasury Auction Result for 13 Week Bill
10/03/2025	1530/1130	*	US	US Treasury Auction Result for 26 Week Bill
11/03/2025	2330/0830	**	JP	Household spending
11/03/2025	2350/0850	***	JP	GDP
11/03/2025	0001/0001	*	GB	BRC-KPMG Shop Sales Monitor