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Oops, the US jobs data released yesterday was too strong to cheer for investors. The report printed 130K new nonfarm jobs last month — roughly double expectations — the unemployment rate ticked lower and average hourly earnings came in higher than expected, remaining steady at 3.7% after earlier months were revised down. The data immediately hit Federal Reserve (Fed) cut expectations, suggesting that such strong job gains could give the Fed more time before lowering rates. In the aftermath, Fed funds futures price in no more than a 21% chance for an April cut, and less than 60% for June. That hurts.

The US 2-year yield, which captures Fed rate bets, rebounded to 3.55% and is consolidating near 3.50% this morning. The US dollar recovered early weakness but could not reverse early-week losses, while US equity indices fell on waning Fed cut expectations, and Bitcoin extended losses below the $70K mark. In short, yesterday’s “good news” from the jobs report was clearly interpreted as bad news by the markets — a classic market reaction.

But if you dig a little deeper, most job gains came from healthcare, social assistance and construction, while other sectors — like federal government and financials — reported job losses. So, the uneven jobs growth may not signal broad improvement.

More importantly, the BLS’ seasonal adjustments and modeling may have overstated underlying job growth, and that true growth may be closer to ~40–50K rather than 130K, it is said...

Looking further, the US labour market was far weaker in 2025 than the monthly headlines suggested. After the BLS benchmark revision, the economy added roughly 181K jobs for the entire year, about 15K per month on average — one of the weakest annual gains outside recession years since the early 2000s. The White House’s immigration policies is certainly to blame.

So the knee-jerk market reaction was decisively hawkish, but the headline numbers hid some underlying weakness. That may explain why yields and the dollar have returned to pre-data levels. Investors now turn to the next important release: the US CPI update due Friday, expected at 2.5%, which could revive Fed doves and offer hope for a few rate cuts this year to support the stock rally.

In equities, major US indices were marginally down across small, mid and large caps.

The selloff in global software stocks continued, with St. James’s Place losing more than 13% in London and Dassault Systems down more than 20% in Paris after weak results. The iShares Software ETF fell another 2.5% in the U.S. Meanwhile, real estate stocks joined the AI panic room, despite no major headlines triggering the drop — just a few analysts warning that AI could negatively impact jobs and, eventually, commercial real estate demand.

My take: this AI anxiety is getting out of control, and the resulting selloff may create interesting opportunities. The world won’t collapse tomorrow, and humans won’t all be replaced by robots. If so, who cares about business anyway? Robots will have to.

Keep calm, take a deep breath, and look for opportunities.

In FX, the USD/JPY rose for the fourth consecutive session, but yen bulls are losing strength near the 152 Fibonacci support, which could mark the end of the yen’s medium-term weakness. That would be a meaningful reversal and a relief for policymakers, as rapid yen depreciation raises imported inflation concerns and complicates Bank of Japan (BoJ) policy. The Nikkei is down this morning, following US peers. Historically, the Nikkei is negatively correlated with the yen, but that correlation could weaken if yen strength encourages a more patient BoJ and softer policy normalization.

Elsewhere, US crude is doing great since the start of the year. The barrel of US crude is flirting with levels above $65pn and is building a support above a key Fibonacci level – the major 38.2% retracement on a decline during the second half of last year. The question is, whether the past two month’s rebound could lead to a sustainable bullish trend. The soft US dollar is supportive, the ample global supply is challenging. Geopolitical headlines could be noisy. A part of the latest bullish push in oil prices was explained by the tense relations between US and Iran. What will be decisive is what happens when the latter tensions will ease. Holding support above the critical $64pb level should keep US crude in the positive consolidation zone and encourage further gains. A return below this level will however throw the market back to the bearish price narrative.

The energy sector is benefiting from this momentum and may hold gains in a rotation trade even if oil prices pause.

In focus today

In the UK, Q4 GDP data is released. The November print was stronger than expected and PMIs also improved in January. Thus, the UK economy is experiencing more tailwinds than we have seen in a long time. However, The Bank of England was less optimistic in its economic outlook last week, where the probability of another rate cut at the March meeting increased significantly. Thus, it will be interesting to follow upcoming data out of the UK.

Overnight, China releases home price data for January, which is one of the key gauges for the housing crisis. Prices continued to decline throughout 2025 showing little sign of stabilising and we look for a further decline in January.

In Norway, we get the annual speech from Central Bank Governor Wolden Bache, where we do not expect any signals on monetary policy, but would be very surprised if the monetary policy consequences of AI are not thoroughly discussed.

Economic and market news

What happened overnight

In Sweden, statistics from the Swedish Public Employment Service show that unemployment, measured as those registered with the agency, fell in January from 6.7% to 6.6%. The number of new job vacancies decreased, and redundancies increased. Slightly mixed signals, but in line with our expectations. The statistics from the Swedish Public Employment Service provide a good overview of the labour market situation and have been a reliable leading indicator for other measures of unemployment.
What happened yesterday

In the US, the January Jobs Report surprised to the upside with NFP growth at 130k (DB: 60k, cons: 70k), unemployment rate at 4.3% (DB: 4.4%, cons: 4.4%) and benchmark revisions reducing March 2025 employment by 898k (DB early estimate: -919k). Education and health care drove job gains (+137k), while the public and financial sectors recorded cuts. Despite a higher participation rate, the unemployment rate ticked lower, indicating strong labour demand. UST yields rose across the curve, and EUR/USD moved lower following the release.

The Congressional Budget Office (CBO) released projections expecting the fiscal 2026 budget deficit to rise to USD 1.853 trillion, or 5.8% of GDP, with the deficit-to-GDP ratio expected to average 6.1% over the next decade. The CBO anticipates economic growth of 2.2% this year, significantly below the Trump administration's 3-4% growth projections. Rising interest costs remain a key driver of the growing deficit, with public debt expected to reach 120% of GDP by 2036.

The House of Representatives voted 219 to 211 to overturn President Trump's tariffs on Canadian goods. The vote is largely symbolic, as Trump is unlikely to sign it into law. Trump defended the tariffs, citing their benefits for economic and national security, and warned Republicans against voting against them.

Equities: Global equities edged higher yesterday, but the headline masks a clear regional divergence. Asia and the broader EM complex posted solid gains, extending the pronounced YTD outperformance versus DM. In contrast, the US and parts of Europe failed to meaningfully respond to the strong US labour data, a move we would normally have expected, particularly in cyclicals and financials.

Macro is currently not the dominant driver. Instead, AI disruption fears continue to reshape risk appetite. Investors are reducing exposure to software and perceived "AI losers" while reallocating into old economy segments. Yesterday, this rotation also weighed on wealth managers. In other words, the underperformance of cyclicals was not macro-driven but rather linked to renewed AI-disruption concerns.

In the US yesterday, Dow -0.1%, S&P 500 -0.01%, Nasdaq -0.2% and Russell 2000 -0.4%.

This morning, Asia is again leading. Notably, Japan is not at the forefront; instead, South Korea is surging, up around 3% at the time of writing. US and European futures are higher as well, with EuroStoxx 50 futures up 0.7%.

FI and FX: In the US, the yield curve flattened following the strong US jobs report, with front-end rates rising more than the long end—the 2-year Treasury gained 6bp while the 10-year rose 4bp. In the euro area, there was some intraday spillover from higher US yields, particularly in the front end, but the moves later reversed. EUR/USD dipped back below 1.19 as the USD broadly strengthened in yesterday's session. A rather uneventful session for the Swedish krona with EUR/SEK closing the session basically unchanged under low volatility. EUR/DKK FX forwards have begun responding to the rise in EUR/DKK spot above 7.4700 this week.

Daily Pivots: (S1) 1.1828; (P) 1.1877; (R1) 1.1921; More….

Intraday bias in EUR/USD remains neutral at this point. On the upside, above 1.1928 will target a retest on 1.2081 high. Decisive break there and sustained trading above 1.2 psychological level will carry larger bullish implications. On the downside, however, sustained trading below 55 D EMA (now at 1.1752) will raise the chance of reversal on rejection by 1.2, and target 1.1576 support for confirmation.

In the bigger picture, as long as 55 W EMA (now at 1.1470) holds, up trend from 0.9534 (2022 low) is still in favor to continue. Decisive break of 1.2 key psychological level will add to the case of long term bullish trend reversal. Next medium term target will be 138.2% projection of 0.9534 to 1.1274 from 1.0176 at 1.2581. However, sustained trading below 55 W EMA will argue that rise from 0.9534 has completed as a three wave corrective bounce, and keep long term outlook bearish.

Daily Pivots: (S1) 152.34; (P) 153.49; (R1) 154.43; More...

Intraday bias in USDJPY remains neutral for the moment. While another fall cannot be ruled out, strong support should be seen from 38.2% retracement of 139.87 to 159.44 at 151.96 to bring rebound. On the upside, sustained break of 55 4H EMA (now at 155.10) will bring stronger rebound towards 157.65. However, sustained break of 151.96 will argue that it's reversing the rise from 139.87 already.

In the bigger picture, outlook is unchanged that corrective pattern from 161.94 (2024 high) should have completed with three waves at 139.87. Larger up trend from 102.58 (2021 low) could be ready to resume through 161.94. This will remain the favored case as long as 55 W EMA (now at 151.68) holds. However, sustained break of 55 W EMA will argue that the pattern from 161.94 is extending with another falling leg.

Daily Pivots: (S1) 1.3588; (P) 1.3650; (R1) 1.3691; More...

No change in GBP/USD's outlook and intraday bias stays neutral . On the upside, firm break of 1.3732 resistance will suggest that pullback from 1.3867 has completed as a correction at 1.3507. Retest of 1.3867 should be seen first. Firm break there will resume larger up trend towards 1.4284 key resistance. On the downside, however, sustained trading below 55 D EMA (now at 1.3505) will raise the chance of larger scale correction, and target 1.3342 support for confirmation.

In the bigger picture, rise from 1.0351 (2022 low) is resuming by breaking through 1.3787 high. Further rally should be seen to 1.4284 key resistance (2021 high). Decisive break there will add to the case of long term bullish trend reversal. For now, outlook will stay bullish as long as 1.3008 support holds, even in case of deep pullback.

Daily Pivots: (S1) 0.7668; (P) 0.7699; (R1) 0.7750; More….

Intraday bias in USD/CHF remains neutral as consolidation from 0.7603 is extending. Strong really could be seen to 0.7816 resistance. But upside should be limited by 55 D EMA (now at 0.7874). On the downside, firm break of 0.7603 will resume larger down trend to 0.7382 projection level next.

In the bigger picture, larger down trend from 1.0342 (2017 high) is still in progress. Next target is 100% projection of 1.0146 (2022 high) to 0.8332 from 0.9200 at 0.7382. In any case, outlook will stay bearish as long as 55 W EMA (now at 0.8152) holds.

Daily Pivots: (S1) 0.7078; (P) 0.7110; (R1) 0.7159; More...

Intraday bias in AUD/USD remains on the upside for the moment. Current up trend should target 100% projection of 0.5913 to 0.6706 from 0.6420 at 0.7213. On the downside, below 0.7063 minor support will turn intraday bias neutral again. But retreat should be contained above 0.6896 support to bring another rally.

In the bigger picture, current development argues that rise from 0.5913 (2024 low) is reversing whole down trend from 0.8006 (2021 high). Further rally should be seen to 61.8% retracement of 0.8006 to 0.5913 at 0.7206. This will remain the favored case as long as 0.6706 resistance turned support holds, even in case of deep pullback.

Daily Pivots: (S1) 1.3515; (P) 1.3567; (R1) 1.3630; More...

Intraday bias in USD/CAD is neutral for the moment as consolidation pattern from 1.3480 is extending. Strong rebound cannot be ruled out, but upside should be limited by 55 D EMA (now at 1.3757). On the downside, break of 1.3480 low will resume larger down trend from 1.4791 to 61.8% projection of 1.4791 to 1.3538 from 1.4139 at 1.3365.

In the bigger picture, price actions from 1.4791 are seen as a corrective pattern to the whole up trend from 1.2005 (2021 low). Deeper fall could be seen as the pattern extends, to 61.8% retracement of 1.2005 to 1.4791 at 1.3069. For now, medium term outlook will be neutral at best, until there are signs that the correction has completed, or that a bearish trend reversal is confirmed.

Daily Pivots: (S1) 0.9129; (P) 0.9150; (R1) 0.9181; More....

Intraday bias in EUR/CHF is turned neutral first with current recovery. Further decline is expected as long as 0.9180 resistance holds. Below 0.9092 will resume larger down trend to 261.8% projection of 0.9394 to 0.9268 from 0.9347 at 0.9017 next. However, considering bullish convergence condition in 4H MACD, firm break of 0.9180 will indicate short term bottoming, and bring stronger rebound towards 55 D EMA (now at 0.9246).

In the bigger picture, down trend from 0.9928 (2024 high) is still in progress with falling 55 W EMA (now at 0.9334) intact. Next target is 61.8% projection of 1.1149 to 0.9407 from 0.9928 at 0.8851. Outlook will stay bearish as long as 0.9394 resistance holds, in case of recovery.

Daily Pivots: (S1) 0.8688; (P) 0.8706; (R1) 0.8729; More…

No change in EUR/GBP's outlook and intraday bias stays neutral at this point. On the upside, firm break of 0.8744 resistance will argue that fall from 0.8863 has completed at 0.8611 as a correction. Further rally should be seen back to retest 0.8863 high. On the downside, sustained break of 38.2% retracement of 0.8221 to 0.8663 at 0.8618 will carry larger bearish implications and turn outlook bearish.

In the bigger picture, rise from 0.8221 medium term bottom (2024 low) is seen as a corrective move. Upside should be limited by 61.8% retracement of 0.9267 to 0.8221 at 0.8867. Sustained trading below 55 W EMA (now at 0.8629) should confirm that this corrective bounce has completed. In this case, deeper fall would be seen back to 0.8201/21 key support zone. However, decisive break of 0.8867 will suggest that EUR/GBP is already reversing whole decline from 0.9267 (2022 high). That should pave the way back to 0.9267.