Markets are opening firmer this morning after a softer finish last week. The Philadelphia Eagles won the Super Bowl in impressive fashion over the Kansas City Chiefs, showcasing the adage that defense wins championships. Friday’s payroll numbers included numerous revisions as expected, but the report overall was strong for the jobs market. The unemployment rate improved to 4.0% and average hourly earnings were up 4.1% over the past 12 months and 0.5% month-over-month, both ahead of expectations.1 The University of Michigan’s inflation expectations were also hotter than the market expected.2 The overall result was a repricing of rates higher on Friday and the 10-year Treasury hovering close to 4.5% again.3 Over the weekend, President Trump announced plans to impose 25% tariffs on imports of steel and aluminum.4
In the week ahead, investors will likely keep an eye on today’s Federal Reserve Bank of New York 1-year Consumer Inflation Expectations.5 Following Friday’s jump in 1-year inflation expectations noted in the University of Michigan report, this report will receive more focus than it typically would. A higher reading on today’s report would be another hawkish signal, and we may see rates move higher again and put pressure on stocks. The consumer price index (CPI) report will be released on Wednesday, producer price index (PPI) report on Thursday and retail sales are slated for Friday.6
Sources:
1Bureau of Labor Statistics – THE EMPLOYMENT SITUATION — JANUARY 2025; 2/7/25
2Investing.com – U.S. Michigan 1-Year Inflation Expectations; as of 2/10/25
3CNBC – U.S. 10-Year Treasury; as of 2/10/25
4Associated Press – Trump says he will announce 25% steel and aluminum tariffs Monday, and more import duties are coming; 2/10/25
5Investing.com – U.S. NY Fed 1-Year Consumer Inflation Expectations; as of 2/10/25
6MarketWatch – U.S. Economic Calendar; as of 2/10/25
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