ARGENTINA: Jan. Construction Activity and Industrial Production

"*ARGENTINA JAN. CONSTRUCTION ACTIVITY RISES 1.2% Y/Y "Argentina Jan. Industrial Production Falls 3.2% Y/y" - Bbg

FED: FOMC Post-Feb Payrolls Commentary Not Alarmist

February's nonfarm payrolls data doesn't appear to have greatly impacted FOMC participants' overall views on the rate outlook, which had appeared decidedly less dovish after the release January's strong report. It sounds as though many will have to weigh the surprise rise in unemployment and sharp drop in payroll jobs alongside the potential macro implications of the conflict in the Middle East before coming up with a synthesis and forming March SEP projection updates. We heard from multiple speakers on Friday after payrolls but before the pre-March FOMC blackout period began - some highlights, in alphabetical order of speaker: * Boston's Collins (leans hawkish, non-2026/2027 FOMC voter): Said she does not put too much emphasis on any particular data point, said February's 4.4% unemployment rate remains low by historical standards and has been relatively stable over the last few months. "Still, it appears that the rate of hiring last year was below breakeven as we saw a modest increase in the unemployment rate." She sees the conflict in the Middle East as exacerbating uncertainty but still does "not see an urgency for additional policy adjustments, and I will be looking for clear evidence that inflation is moving durably toward the 2% target - something that might occur only over the second half of the year." * San Francisco's Daly (dovish, 2027 FOMC voter): Said "I had hoped the 75 basis points we did last year would put a floor underneath the labor market. But this jobs market report has got my attention, and I've long been worried about it...the labor market is maybe a little weaker than we have seen so far." That said, "I think it's really important to step back. No one month of data is a decisional month of data. I think it just tells us that, you know, the hopes that the labor market was studying maybe we maybe that was too much, and we really have to keep our eye on the labor market, but we also have inflation printing above target and oil prices rising. How long they last, we don't know, but both of our goals are risks now, and we have to keep our eye on both." * Chicago's Goolsbee (2027 FOMC voter, near-term hawk but longer-term dove): Said he remains more concerned about elevated inflation despite a "tough miss" on the February jobs report. The added uncertainty of rising oil prices bolsters the case for the Fed to hold rates. "As we get more uncertainties, I think the time at which it makes sense to act keeps getting pushed back...I remain hopeful that conditions will improve, that we'll start to see some progress on inflation, headed back to 2%, and by the end of the year that we would be in a situation that we could commence our march back down to the settling point." Of the rise in the unemployment rate in February, "if you've got several months like that, that would be a concerning spot for the labor market." * Cleveland's Hammack (2026 voter, one of most hawkish on FOMC): Said that with inflation high alongside a softening labor market, "Given this combination and recent rate reductions, I believe policy is in a good position. The fed funds rate is around neutral, which allows us to see how things are going to play out." "Under my base case, I think policy should be on hold for quite some time as we see evidence that inflation is coming down and the labor market stabilizes further. But it's easy to envision other scenarios, as well, so I see two-sided risks to rates." * Gov Miran (permanent voter, biggest dove on FOMC): Said "Policy is pretty miscalibrated...The labor market could use more support from monetary policy." The oil price spike from the Iran war "slightly weighs on core inflation because it pulls demand out of the economy as people have to spend more on energy products. I'm hesitant to react to what's going on oil until we know more but if anything it biases more toward more dovish policy."

US DATA: Payrolls Wrap: Weak And Volatile But Trend U/E Rate Broadly Stable

* Key figures in both the establishment and household surveys disappointed in the February payrolls report although it must be seen in the context of strong January report. Indeed, even the most dovish FOMC member, Governor Miran, cautioned against reading too much into one month's job report. * It still acts as a dovish surprise though as it firmly pushes back on any more optimistic views of the labor market going into this report. * The themes broadly flagged ahead of the report were as expected although the magnitude was surprising. There were two healthcare-related hits, one fully expected (31k strikes) and one less so (potential reversal after a severe flu season in January), whilst adverse weather might well have played a role but was still hard to square away the extent of industries reporting job losses. * Nonfarm payrolls fell -92k (cons 55k) after 126k as part of heavy negative revisions of -69k, leaving a three-month average of 6k and six-month average of -1k. Private payrolls fell -86k (cons 60k) after 146k with a three-month average of 18k and six-month average of 34k, whilst private ex health & social assistance sees a three-month average of -29k and six-month of -16k after sizeable declines last year. * The household survey brought some meaningful surprises and oddities, in terms of both the monthly data and the annual population control revisions. Understanding February dynamics depends largely on figuring in the annual revisions, though overall February's household report looked largely weak. * For a household survey bottom line, the u/e rate surprised higher in Feb at 4.44% (cons 4.3 with dovish risk tilted to a 4.4) after an upward revised but what would still have surprised lower 4.32% in Jan. The latter was first reported at 4.28% vs then consensus of 4.4%, before unusually being revised with the delayed population control back on January levels. * Average the two monthly prints and the 4.38% sits between the heavily caveated 4.47% averaged in Q4 (government shutdown disruption) and 4.34% in Q3. * That broad stability continues to defy a scenario that the most dovish FOMC members had envisaged back in the December SEP (seven members pencilled in an u/e rate at 4.6-4.7% in 4Q25), with some of these prominent members since dialling back cut calls/rhetoric over the past month. * In a reminder of the risk in putting too much weight on single reports, response rates were at best mixed. The household survey response rate increased from three months of record lows but remains depressed and leaves it prone to higher than usual month-to-month volatility, whilst first responses for payrolls data slid back to very low levels and leave scope for larger revisions. * Whilst heavily clouded by today's surge in WTI futures (1st currently nearing +13% on the day) and two-way swings in rates since the release, there has been a net dovish shift with June Fed Funds implied rates 4bp lower post-release and Dec 8bp lower. A next Fed cut is seen in September in a close call with July (22bp) and with 45bp of cuts seen for 2026.

IRAN: *IRAN SAYS EU ‘LEGITIMATE' TARGET IF IT JOINS WAR: FRANCE 24" - Bloomberg

"*IRAN SAYS EU 'LEGITIMATE' TARGET IF IT JOINS WAR: FRANCE 24" Bloomberg