Fed Hawks Eye Slower Cuts

Date: February 03, 2026

Fed Hawks Eye Slower Cuts

Summary

Market Snapshot

Prior Close
Asset Level Days Change
S&P 500 6,985.40 +0.51%
Nasdaq 23,592.11 +0.56%
Spot VIX 16.25 -0.55%
2 Year Bond Yield 3.59 +1 bps
10 Year Bond Yield 4.29 +1 bps
EUR/USD 1.1966 -0.10%
USD/JPY 155.92 +0.22%
GBP/USD 1.366 -0.06%
WTI Oil 65.21 -0.32%
Gold 4,902.83 +5.21%
Bitcoin 77,977.51 -0.88%

Prior Economic Events

Data Prior Cons Actual
Ny Fed Bill Purchases 4 To 12 Months---
ISM Manufacturing PMI47.9048.5052.60
ISM Manufacturing Employment44.80-48.10
Speech by Fed's Bostic---

Upcoming Economic Events

Data Prior Cons Time
Speech by Fed's Barkin--08:00
API Weekly Crude Oil Stocks-250,000-16:30
MBA 30-Year Mortgage Rate6.24-07:00
ADP Employment Change41,00040,00008:15
Ny Fed Bill Purchases 1 To 4 Months--09:20
Services Sector PMI54.4053.5010:00
EIA Weekly Crude Oil Inventory-2.3m-10:30
EIA Weekly Gasoline Inventory224,000-10:30
Fed Cook Speech--18:30

Yesterday's Recap

ISM manufacturing PMI jumped to 52.6 from 47.9, far exceeding consensus of 48.5, driven by strong output and new orders as tariff uncertainties eased. Fed's Bostic highlighted data-driven policy, noting inflation pressures from global supply chains. Markets calmed with VIX at 16.25, but yields edged up 2bps on 10-year Treasuries to 4.29%, while S&P 500 held steady near 6985. EUR/USD dipped to 1.1966 as dollar gains persisted, and gold retreated 2% to 4902 on Fed hawkishness. Bitcoin stabilized at 77977 after recent volatility.

The Day Ahead

ADP employment change due at 8:15am, expected at 40000, offering early labor insights amid delayed January jobs report. Services PMI at 10am projected at 53.5, with Fed Barkin speaking at 8am on economic outlook. EIA crude stocks at 10:30am and Fed Cook speech at 6:30pm will gauge inflation and policy signals.

Other Economic Notes

Data integrity concerns escalated as BLS delayed January jobs report due to government shutdown, risking distorted Fed decisions. Global trade tensions intensified with EU's 'Made in Europe' push against Chinese imports, straining supply chains.

Fed Watch

In a rate-cutting cycle, recent data like ISM's beat supports gradual easing, but Warsh's nomination leans hawkish, favoring fewer cuts in 2025. Markets price only two rate reductions this year, likely post-June confirmation. Powell's dovish tone contrasts with Warsh's tighter stance, heightening uncertainty.


Source: https://robomacro.com/Research_Notes/US_Macro_Daily_20260203.html