(Bloomberg) — US employers probably added jobs at a moderate pace in February at a time of federal government layoffs and a consumer spending slowdown.
Payrolls rose by 160,000 in February, a slight improvement from the 143,000 increase a month earlier yet softer than during the final months of 2024, according to the median projection of economists surveyed by Bloomberg. The unemployment rate is seen holding at 4%.
Friday’s report from the Bureau of Labor Statistics will provide an update for Federal Reserve officials about momentum in the labor market that’s been the key support — at least until January — of household spending and the economy. However, rapid policy changes by the Trump administration — including the push by Elon Musk’s Department of Government Efficiency to shrink the federal government and cut spending — risk elevating uncertainty about the outlook.
Fed Chair Jerome Powell is slated to speak at a monetary policy forum Friday afternoon. Policymakers next meet March 18-19 and they’re expected to hold interest rates steady as they gauge the labor market and inflation trends as well as recent government policy shifts.
Other officials speaking in the coming week include Fed governors Adriana Kugler and Christopher Waller, as well as New York Fed President John Williams. Treasury Secretary Scott Bessent is also speaking before the Economic Club of New York.
Treasury Secretary Scott Bessent said Sunday that he’s confident US inflation will slow over the course of the year as two polls signaled that President Donald Trump risks putting off Americans worried about the economy and consumer-price growth with the broad flurry of measures during his first weeks in office.
Recent surveys already show consumers are shedding optimism about business conditions and the job market over the next several months. Figures from the Institute for Supply Management and S&P Global will help show whether manufacturers and service providers are seeing orders and business activity cool as managers assess a growing threat of tariffs.
Trump’s administration is planning to enact 25% tariffs on imports from Canada and Mexico on March 4, the same day the president addresses a joint session of Congress and may drop other policy bombshells.
The February jobs report may also include the initial effects of a federal hiring freeze, though thousands of public-service layoffs occurred too late in the month to have a material impact this time around. And while federal jobs account for a small share of overall payrolls, funding cutbacks risk bleeding into the private sector that supports — and is supported by — government-funded programs.
What Bloomberg Economics Says:
“Softening sentiment, a contraction in spending, downward revisions to first-quarter GDP growth expectations – data in the past week have stirred growth fears in the market, challenging the narrative of the US economy’s ‘exceptionalism.’ Data and events in the coming week could turn these flickers of concern into a real fire.”
—Anna Wong, Stuart Paul, Eliza Winger, Estelle Ou & Chris G. Collins, economists. For preview, click here
In Canada, government officials are expected to continue their push to avert Trump’s planned levies on most Canadian goods.
Among economic data, the international trade report for January may show a continued surge in exports to the US as the loonie weakened and American importers looked to get ahead of potential tariffs. Employment data for February may similarly continue a trend seen the previous month, in which manufacturing jobs boomed, likely due to tariff front-running.
Elsewhere, Chinese manufacturing PMIs, inflation readings from Australia to Switzerland to Mexico and rate cuts at the European Central Bank and in Turkey will be in focus.
Click here for what happened in the past week, and below is our wrap of what’s coming up in the global economy.
Europe, Middle East, Africa
The week kicks off with the latest inflation reading for the euro area, which — following mixed signals from Germany and France — likely slowed to 2.6%. While still clearly above the ECB’s 2% target, the deceleration will be a relief for central bank officials, who on Thursday in Frankfurt are set to deliver another 25 basis point rate cut — the sixth such move since June.
What happens next is less clear, with policymakers led by President Christine Lagarde increasingly torn on how far they should go. New economic forecasts published alongside the rate decision could provide some clarity, though the threat of US tariffs clouds the outlook.
The Danish central bank typically mirrors any ECB move, and so is expected to lower rates as well on Thursday.
Earlier that day, Turkey will probably also cut borrowing costs — encouraged by new inflation data due Monday likely to show a slowdown to 40% in February — while Ukraine is seen hiking rates for a third straight meeting.
In the UK, Bank of England Governor Andrew Bailey will be among ratesetters questioned by the Treasury committee on their decision to lower rates by a quarter point in February.
Beyond central banks, South African data on Tuesday is expected to show gross domestic product expanded 0.9% in the fourth quarter, against a 0.3% contraction in the prior three months, in part due to a rebound in the agricultural industry and strong growth in the retail sector.
Swiss inflation a day later will probably show a reading of just 0.2% for February, the weakest since March 2021. The central bank has warned that inflation readings could drop below zero in some months this year and predicts consumer-price growth to average just 0.3% in 2025 as a whole.
In Germany, factory orders on Friday are expected to show a contraction, reminding politicians hashing out their priorities in forming a new government of the country’s industrial malaise.
The situation in Ukraine will, however, overshadow everything else in the region after a meeting between Trump and Ukrainian counterpart Volodymyr Zelenskiy blew up on Friday, throwing US support into question.
Bloomberg Economics calculates that protecting Ukraine and expanding their own militaries could cost Europe’s major powers an additional $3.1 trillion over the next 10 years.
UK Prime Minister Keir Starmer hosts European leaders on Sunday in London, ahead of an emergency EU summit in Brussels on Thursday.
Asia
It’s set to be a busy week in Asia with readings on inflation, growth, manufacturing activity and consumer health across several major economies.
It starts Monday morning with a look at February factory activity from the S&P Purchasing Managers’ Index for Australia to Japan, part of their string of global readings that day. Things had cooled at the start of the year — and that was before Trump announced a series of tariffs that could impact the region. The Caixin manufacturing PMI that day will be closely watched as well, for signals on the health of the Chinese economy ahead of the National People’s Congress.
China’s central bank said Sunday it will help keep financing costs in check for private companies, in the latest move by the nation to give the sector a freer hand.
There’s more in the manufacturing space with industrial production figures for South Korea on Tuesday and Vietnam on Thursday.
Inflation readings for February begin rolling in on Monday, with the index from Australia’s Melbourne Institute of Applied Economic and Social Research plus Indonesian consumer prices. Inflation data is also out for Thailand and the Philippines on Wednesday (as well as commodity price data from New Zealand), South Korea and Vietnam on Thursday, and Taiwan on Friday. Prices have generally been trending down across the region although they got a pop in January.
Snapshots of consumer strength will be seen in January retail spending figures for Hong Kong on Monday, Australia on Tuesday, and Singapore on Wednesday. Vietnam is then first out of the gate with February figures on Thursday. Hong Kong’s will be watched for signs of life after the annual budget unveiled in February included a range of cost-cutting measures. Other indicators of how consumers are feeling will be seen in confidence data for Japan on Tuesday and potentially as soon as next week for Thailand.
GDP figures come on Wednesday for Australia and South Korea. Data on Sunday revealed that new home sales in the latter plunged 46.2% in January from a year earlier, adding to the nation’s stock of unsold properties. Separate Australia numbers showed that house prices rebounded last month as buyers jumped into the market in anticipation of the first rate cut in more than four years — which the Reserve Bank then delivered two weeks ago.
Among central banks, minutes of the Reserve Bank of Australia’s February meeting are due on Tuesday and Malaysia’s monetary policy institution is expected to hold rates Thursday. We get a peek into foreign reserves for most countries in the region Wednesday through Friday to see if levels are hanging on amid growing risks of volatility.
The raft of data from Japan continues into a second week with fourth-quarter capital spending and company profits on Tuesday.
Trade data caps the week, with Australia and Vietnam reporting activity and the overall trade balance on Thursday, followed by Taiwan and China on Friday. The latter will act as a gauge for Trump’s tariff announcements, to see whether there may have been front-loading of orders, and also to track a surplus that last year reached a record.
Latin America
Brazil and Argentina, South America’s two biggest economies, will observe the Carnival holiday along with a number of others in the region, thinning out the region’s usual schedule.
In Mexico, the government is racing the clock ahead of Tuesday’s US tariffs deadline. Treasury Secretary Scott Bessent on Friday said Mexico had proposed matching the US’s tariffs on China, signaling a potential path to avert levies on its own exports.
In Chile, January GDP-proxy data is due on Monday. December data showed the economy growing above its potential and central bank forecasts.
Exogenous risks abound, not least of which are uncertainty over global trade, Fed policy and the possibility of US copper tariffs.
On Brazil’s return from Carnival, the central bank on Wednesday posts its so-called Focus survey of economists as a prelude to Friday’s fourth-quarter output report and February trade data.
In the market readout posted Feb. 24, analysts’ inflation expectations for this year and next continued to drift higher, although the key rate outlook was unchanged.
As to growth, economists have been marking up their GDP forecasts for Latin America’s biggest economy, with the year-on-year estimate now at 4.1%.
Argentina has a light slate with just government tax revenue, industrial production, construction activity and February’s automobile industry report.
The country’s president, Javier Milei, announced Saturday night that he will seek congressional support for a new program his government is negotiating with the International Monetary Fund, the most concrete sign yet that talks are advancing toward final stages.
Rounding out the week’s key indicators, three of the region’s big economies report February consumer prices ahead of central bank monetary policy meetings later in March.
Inflation may have eased marginally in Chile and ticked slightly lower in Colombia, while pushing back up toward the top of the 2% to 4% target range in Mexico.
–With assistance from Craig Stirling, Katia Dmitrieva, Laura Dhillon Kane, Monique Vanek, Robert Jameson and Piotr Skolimowski.
(Updates with polls in sixth paragraph.)
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