The Day at a Glance | March 8 2023

*US private-sector job growth increased more than estimated.

*The final 4Q22 GDP reading for the euro area confirmed the downward revision to 0.0% quarterly, from the initial reading of 0.1%. Similarly, the annual data was adjusted marginally lower to 1.8% (-0.1%).

*US wholesalers’ inventories retracted -0.4% monthly during January.

*US trade balance showed a $68.3 billion deficit in January.

*This afternoon, the FED will publish its Beige Book about current economic conditions. 

Economic environment

US private sector payroll (ADP) for February surprised upwards with 242k new jobs, more than the 200k estimated. This reading is more than double of new jobs created in January, which was revised to 119k since the 106k reported originally. In addition, the average pay growth for those workers that remained in their jobs was +7.2% in the month. In this way, the data shows a still solid labor market for the private sector in the first two months of the year, with a high hiring volume and elevated pay growth. However, on the eve of the jobs report release from the Bureau of Labor Statistics (BLS), it is remarkable the little predictive power of the ADP above the BLS, as shown in the January figures when the private sector registered a decrease to 106k jobs (originally reported) since 235k in December, while the BLS report surprised with 517k new posts in January since 223k written in the previous month.