Making Sense

"We may never know where we are going, but we'd better have a good idea of where we are" Friday saw the release of the much awaited NFP data print and along side the ISM Non Mfg PMI which is a survey based measure. An analysis of the NFP data should not only focus on the headline number but also various other details like revisions, participation rate, employment rate etc. On the surface reading, the numbers showed strength as can be seen in the table below:   NFP▲ UR (in %) AHE mom AHE yoy Nov-23 173,000 3.7 0.35% 3.96% Exp 1,70,000 3.8 0.29% 3.90% Dec-23 2,16,000 3.7 0.40% 4.10% The prior two months were revised lower by 71K with the Oct - Dec  average at 164,667 compared to Jul - Sep 3 month average of 221,000 which clearly points to a decelerating trend in Employment gains. The unemployment rate was steady at 3.70% due to a drop in Labor participation rate. Under the hood, the Civilian Labor Force declined by 676,000 and the number of employed people fell by 683,000. ...

 The U.S Employment Situation Report was released on Friday . Details of the economic release: 1. NFP 311K - above consensus estimate of 205K and following a revision to January number to 504K from 517K. E mployment gains in December and January combined were 34,000 lower than previously reported 2. Participation Rate moved higher to 62.50% from previous 62.40%  3. Unemployment Rate moved higher to 3.6% from decadal lows of 3.40%  4. Average hourly Earnings (AHE) rose 0.24% mom with the pace of monthly rise decreasing from previous 0.27% The report showed strength and the softening in momentum of rise in AHE.  However, the Employment Report coincided with the news of the closure of the Silicon Valley Bank (SVB). SVB is the 16th largest bank in the United States and the largest bank by deposits in Silicon Valley. The pace at which the whole situation unravelled in mindboggling. Closure of SVB Bank comes in quick succession to the closure of Silvergate Bank. SVB had $...