Labor

Following Wednesday's blowout ADP report, which printed some 40K jobs higher than the highest estimate, the only possibility for tomorrow's nonfarm payroll report, the last major economic data point before the Fed's March 15th rate hike announcement, is to disappoint, especially in terms of wages (which in light of the recent downward revision of Q1 GDP by the Atlanta Fed to 1.2% is not out of the question). That possibility, however, is slim to none if one looks at Wall Street's forecasts, where virtually every sellside analyst boosted their NFP estimate in the hours after the ADP number.

Job creation has been a key focus of the Trump administration which has blamed outsourcing to lower cost countries like Mexico and China for the stagnant wages of the middle-class working folks of America's Midwest.

Dear Bernie Sanders, it is our great pleasure to introduce to you, "Flippy", the burger-flipping robot that will soon replace all those fast food workers that you're working so vehemently to get fired via your efforts to introduce artificially high $15 per hour minimum wage rates.

American companies are riding high on the optimism created by President Trump’s election victory, adding a staggering 298,000 jobs to the U.S. economy during Trump’s first month in office. That monster figure comes from ADP, a payroll processing company that surveys the U.S. job market. The number far exceeded the 190,000 new jobs that economists were forecasting. President Trump tweeted a self-congratulatory note from the @POTUS account, referencing the long overdue “surging” growth in the jobs market and admitting the numbers are “much more than expected!“ U.S.

Following the massive ADP employment beat (but productivity disappointment), March rate hike odds finally upticked to certainty. Fed Funds futures now imply a 100% chance that The Fed hikes next week.

Up from low 20s to 100% in a month...

What did The Fed see that suddenly spooked them all?

Which reminds us of the WTF-est chart we know of right now - as The Fed's forecast for
GDP collapses, so the odds of a rate hike soar (FF Futs tumble)...