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Today Is About Jobs, But Not Really

Marc Chandler profile picture
Marc Chandler


  • Easing trade tensions and US-NK thaw lift Asian equities, dollar-bloc and Scandi currencies.
  • Large options in yen and euro that expire today.
  • US and Canadian jobs data are unlikely to significantly change market expectation for central bank action.

(About to set off on another business trip. I will spend the next two weeks in Asia. The updates will be sporadic. Thanks for your patience.)

The US Administration has softened its initial hardline position of no exemptions for the new steel and aluminum tariffs. There is little doubt that the actions will be challenged at the World Trade Organization and the idea that national security includes the protection of jobs for trade purposes will be tested.

At the same time, US President Trump has agreed to meet North Korea's Kim Jong-un. We argued that when North Korea claimed to have a nuclear missile that can strike the US mainland, the conditions would allow for talks. Of course, the US will maintain that it is its tough line that brought North Korea to the table. South Korea will maintain that through its gestures, including the cooperation over the Olympics, that made for the break-through.

In any event, the meeting diffuses some investor anxiety. Asian stocks rallied, led by the over 1% gain in Korea's Kospi. The MSCI Asia Pacific Index rose 0.3%, matching the weekly advance coming into today. The dollar also rallied to almost JPY107. It finished last week near JPY105.75. The dollar has not closed above its 20-day moving average against the yen since January 8. It is found near JPY106.75 today. There is a $1.2 bln option struck at JPY106.50 and another $4.1 bln struck at JPY107 that expire today.

More broadly, the dollar is mixed. The risk-on mood is expressed in the foreign exchange market today with stronger dollar-bloc and Scandi currencies. While the yen is the heaviest, the euro, Swiss franc, and sterling are nursing small losses.

There is a 2.1-bln euro option struck at $1.23 that will be cut today and 2.3 bln option struck

This article was written by

Marc Chandler profile picture
Marc Chandler has been covering the global capital markets in one fashion or another for 25 years, working at economic consulting firms and global investment banks. A prolific writer and speaker he appears regularly on CNBC and has spoken for the Foreign Policy Association. In addition to being quoted in the financial press daily, Chandler has been published in the Financial Times, Foreign Affairs, and the Washington Post. In 2009 Chandler was named a Business Visionary by Forbes. Marc's commentary can be found at his blog (www.marctomarket.com) and twitter www.twitter.com/marcmakingsense

Analyst’s Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article.

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Comments (2)

Today’s news IS about jobs. Over 300,000 new hires would likely agree with me. Thank you President Trump!
Great Feb job report sending the USD higher.
The US10Y is testing the previous high of 2.97%.
Time to celebrate : US economy is strong and the tariff volatility are gone.
25% to 60% steel tariff is not targeting : Canada, Mexico, Australia, EU, Japan,
so, who is in the cross hair.
If N + S Korea will be allowed to hug and achieve a "climax", will it lead to a domino
collapse of US position in the Asia region.
USD move higher, can it move from 88 to the 113, 115 region, then higher to
above the 1999, 2000 & 2001, to about 135 level, next even higher testing the 1985 peak of 164 ==> is that a good news to the Korean familia, Japan and the rest of Asia exporters.
Let China, a rising power "express" herself and unite all the exporters under the Chinese umbrella.
Who will be the importer : Macron & Trump ?
USD rise, does it indicate UST10Y > 3.0% due to future inflation expectations, or back to the
zero line in a prolong deflation.
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