Asian Market Update: Treasury yields have stabilised after selling off yesterday after Fed Chairman Powell failed to push back against the rise in rate. the U.S. 10-year rate corrected slightly overnight but remains at 1.56%. JGBs, meanwhile rallied after BoJ's Kuroda squashed speculation that the central bank would widen the implicit band around the yield curve target. The 10-year rate is currently down -5.3 bp at 0.079%, while yields jumped 6.0 bp and 7.5 bp in Australia and New Zealand. Stock markets across Asia traded mixed, with indices moving up from early lows. Nikkei and ASX were still down -0.2% and -0.7% respectively at the close, but Hang Seng and CSI 300 are currently posting fractional gains. Oil prices jumped higher after the OPEC+ meeting decided to maintain current output levels. The front end WTI future is currently trading at USD 64.60 per barrel. In FX markets meanwhile the dollar was supported, while the yen struggled, leaving USD-JPY at 108.24.

U.S. nonfarm payroll preview: analysts expect a 350k increase in February nonfarm payrolls after the 49k increase in January, and following the -227k decline in December. Analysts assume a 25k factory jobs increase in February, after a -10k January drop. Analysts assume the jobless rate will sustain the January plunge to 6.3% from 6.7% in December. Hours-worked are assumed to be flat after a 0.9% January bounce, with the workweek slipping to 34.9 from 35.0 in January. Average hourly earnings are assumed to rise just 0.1% in February, as analysts further unwind the December distortion that left a 1.0% earnings surge with a big drop in low-wage workers. The y/y wage gain should slip to 5.2% from 5.4%. Analysts previously saw a 3.5% expansion-high pace for y/y wage gains in both February and July of 2019, before the pandemic-boost to an 8.0% April peak. Analysts expect the payroll rebound to gain steam in 2021 following the winter lull, thanks to stimulus deposits and vaccines.