The Day at a Glance | March 10 2023

*The US employment report once again surprised to the upside by logging a significant increase in the number of created jobs during February compared to the estimated number of positions. 

*The unemployment rate in the US increased to 3.6% in February, but it was also accompanied by an increase in labor force participation to 62.5%. 

*During January, the inflow of foreign currency to Mexico derived from the spending of international visitors amounted to 2.835 billion dollars, reflecting a 43.18% yearly increase, boosted by both a higher number of visitors (+37.7% y/y) and average spending (+3.9% y/y). 

*On Thursday, US President Joe Biden presented the annual budget, which focuses on expanding the social safety net. However, the proposal is unlikely to be approved due to the Republican Party`s control of the House of Representatives. 

*After a unanimous election with 2,952 votes in favor, Chinese President Xi Jinping was re-elected today to continue his position for another five-year term. 

Economic environment

US employment figures showed a robust labor market in February. The employment report indicated that the US economy created 311,000 new jobs last month, which is certainly a moderation from the surprising 517,000 figure logged in January; but remains at particularly high levels considering the Federal Reserve`s increasing cycle – it`s also high compared to the estimated 225,000. The services sector continues to show the greatest strength, having created 226,000 new jobs las month, down from the previous 297,000. Strong job creation was accompanied by an increased participation in the labor force, with it reaching 62.5% (62.4% prev.) and beating estimates, while the unemployment rate rose to 3.6%, compared to the forecasted 3.4%. Lastly, wages continue to increase, and the annual rate showed acceleration, rising from 4.4% in January to 4.6% in February. Overall, labor market figures show no signs of relief, and regardless of February`s inflationary figure, which will be made known next week, today`s data will impact the magnitude of the FED`s next interest rate increase, considering its relevance and impact on the future inflationary trend.