http://www.bloomberg.com/apps/news?pid=20601068&sid=alAMN_KVoQ6M
Initial jobless applications fell by 29,000 to 469,000 in the week ended Feb. 27, in line with the median forecast of economists surveyed by Bloomberg News, Labor Department figures showed today in Washington. The number of people receiving unemployment insurance decreased to the lowest level in a year, while those receiving extended benefits climbed.
So far, my trade ideas are performing well. 2-year notes now yield 86 bps and 10-year notes now yield 364 bps, so 2s-10s has flattened to 278 bps (I recommended a 2s-10s flattener at 282 bps). Two days ago, I wrote that I thought that 2-year yields would go higher. 2-year notes were yielding 81 bps two days ago and now they yield 86 bps. I wrote a bullish post on USD/JPY yesterday when the exchange rate was at 88.72; now USD has strengthened vs. JPY to 89.01. Two and three days ago, I highlighted the improving employment picture (“Firms Move Gingerly to Rescind Salary Cuts” and “The unemployment rate is starting to turn”).
Today’s initial claims report is worth paying attention to, but tomorrow’s nonfarm payrolls report is more important. I think we will see further confirmation of an improving employment picture, but this is by no means assured. A weak payrolls number could easily turn my winning trade ideas into losers. However, 2s-10s, 2s, and USD/JPY are at such extreme levels that even if tomorrow proves to be a bad day for my trade ideas, I feel confident that they will pay off eventually.