(Bloomberg) — U.S. wage growth settled after perhaps the strongest month of hiring in a year in February, with hiring returning to a more moderate and likely sustained pace.
Economists forecast an addition of 60,000 jobs for the month — less than half the number created at the start of the year, according to a Bloomberg poll of analysts ahead of Friday’s report. The unemployment rate held steady at 4.3%.
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After years of trying to attract workers, employers began hiring again in 2025. The result was the weakest year for wage growth outside the recession since 2003. This caused concern among American consumers who were the primary source of fuel for the economy.
The longer the labor market is stretched, the more likely it will be to test consumer sentiment. January retail sales data, the same day as the payrolls report, are unlikely to provide any concrete signals as harsh winter weather dampened activity in many parts of the US.
Economists forecast modest increases in arrivals at U.S. retailers, except for car dealerships and gas stations. Oil prices fell to five-year lows at the start of the month before recovering in the final weeks of January. Auto sales are down, likely due to the weather, according to industry figures.
Here’s what Bloomberg Economics says:
“We expect a 30K decline in February payrolls, a sharp drop from January’s surprisingly strong print. The slowdown is more a reflection of the cold spell than the weakness in hiring conditions in late January and early February. Weather-sensitive sectors have been particularly hard hit, including construction and entertainment, and the potential market conditions that have weighed on our labor market since last fall.”
—Anna Wang, Stuart Powell, Eliza Winger, Chris G. Collins, Alex Tanzi and Troy Dury, Economists. For a full analysis, click here
In addition to the jobs and retail sales reports, economists will analyze a pair of surveys on manufacturing and services for clues about business sentiment. The Institute for Supply Management will release its productivity index on Monday, and measure group services performance on Wednesday.
The Federal Reserve will release its benchmark book on Wednesday, offering historical insight into economic conditions around the country.
In Canada, officials will survey the outlook on a more volatile world, with Bank of Canada Governor Tiff McCallum discussing risks to economic and financial stability and Deputy Governor Sharon Kozicki outlining how the monetary policy framework needs to be adapted.
Marketers will also analyze product data for signs of a year-end rebound. Prime Minister Mark Carney travels to India, Australia and Japan, promoting efforts to diversify trade ties.
Elsewhere, a slew of inflation numbers – from the Eurozone to Turkey, and from South Korea to Chile – as well as several activity indicators and China’s National People’s Congress will be among the highlights. The consequences of joint US-Israeli attacks on Iran will also be considered.
Click here for what happened last week, and below is our coverage of what’s happening in the global economy.
Asia
The week began with export data for South Korea, which showed a sharper pace in February, reinforcing the central bank’s view that strong semiconductor demand is helping the economy as it maintains a neutral policy stance.
Australia releases data on Wednesday that is expected to show that growth slowed in the fourth quarter, in figures that are likely to keep January inflation above the bank’s target, fueling speculation about a Reserve Bank of Australia rate hike next year after January inflation this year.
China receives PMI data on the same day, which may highlight the need for more policy support after a sluggish start to the year. Meanwhile, the National People’s Congress, which begins on Thursday, will set the tone for the economy next year.
Both the official manufacturing and non-manufacturing gauges for February are forecast to remain contractionary. RatingDog’s indicators are also slightly more favorable because of this.
Other Asian countries releasing PMI statistics next week include Indonesia, Malaysia, the Philippines, Thailand, Singapore, South Korea, Taiwan and Vietnam.
Japan’s Finance Ministry released a report card for companies on Tuesday. Fourth-quarter earnings will reveal whether companies have the opportunity to maintain strong wage growth, and capex data will be closely watched after preliminary GDP for the period showed a modest 0.2% growth in business spending. Tuesday’s figures will be factored into revised GDP on March 9.
South Korea’s consumer inflation edged up slightly in February, to 2.2%, likely keeping the Bank of Korea in a holding pattern for now. Indonesia’s February consumer inflation is expected to accelerate to 4.34% after registering the fastest clip since 2023 a month earlier, in data that could test Bank Indonesia’s resolve to remain accommodative.
Also releasing CPI figures are Thailand, the Philippines and Vietnam. Trade data is from Vietnam, Australia, Indonesia and Pakistan.
In central bank action, three RBA officials are due to speak, potentially giving clues on when the next rate hike will take place, overnight rate-setting in the indexed swap market only hinting at the chance of a further hike at the next decision on March 17.
Deputy Governor Sarah Hunter speaks at the Norges Bank conference in Oslo on Monday. The following day, Governor Michelle Bell is speaking at the AFR Business Summit in Sydney, and Deputy Governor Andrew Hauser is speaking at a panel in New York over the weekend. Elsewhere, Malaysia’s central bank is forecast to keep the overnight policy rate steady at 2.75% on Thursday.
Europe, Middle East, Africa
This is a big week for inflation. After joint reports from the euro area’s three largest economies, forecasters expect annual consumer price growth to rise 1.7% in February. This would match the previous reading, which was the lowest since September 2024.
On Tuesday the data will be released at the same time as Italy’s inflation numbers, which are expected to show a slight rise, to 1.1%.
Other Eurozone statistics included industrial production in France and Spain on Thursday, giving the first strong outlook for output at the start of the year. German factory orders on Friday may shed light on whether Berlin’s defense and infrastructure stimulus is feeding the region’s largest economy.
Among the many European Central Bank events on the calendar, President Christine Lagarde will appear on Monday and Thursday, while Executive Board member Isabelle Schnabel is speaking in New York over the weekend.
Speaking on Sunday, Bundesbank President Joachim Nagel said “the current inflation picture in the euro area is broadly favorable” and that “we are in a good position with regard to monetary policy”.
Potential sovereign credit ratings after the market close on Friday include France and Portugal’s Fitch ratings.
The UK’s main focus will be Chancellor Rachel Reeves’ spring forecast on Tuesday. Expectations are muted, although a backdrop of political turmoil surrounding Prime Minister Keir Starmer’s leadership may draw attention to any fiscal implications.
In Sweden, the CPIF measure of consumer prices targeted by the Riksbank may have fallen to 1.8% in February, the lowest since 2024. Core inflation may have also slowed, undershooting central bank forecasts, in part due to a stronger currency. These numbers are due on Thursday.
Equivalent data will be released in Switzerland on Wednesday. Most economists think that inflation has either stagnated or prices have shown a sharp annual decline in the past month. While it will focus on the Swiss National Bank, President Martin Schlegel has already acknowledged the possibility of “negative press” while insisting that such an outcome would not be a problem.
Turning to Eastern Europe, Hungary’s fourth-quarter growth data on Tuesday will provide clues on whether Prime Minister Viktor Orban’s pre-election bankroll has materialized. Romania, meanwhile, is expected to present a draft budget for 2026.
On Wednesday, Poland’s central bank may resume rate cuts, with inflation expected to remain low.
Finally, Turkish data on Tuesday may show inflation accelerating to 31.5%. Officials have largely attributed the increase in food prices to being temporary. Rate cuts are expected to continue, although possibly at a slower pace than January’s 100 basis point cut.
Latin America
Chile posted GDP-proxy data for January on Monday, likely boosted by domestic demand, near-record prices for copper – the country’s No. 1 export – and high expectations for market-friendly policies from President-elect Jose Antonio Caste.
Later in the week, February inflation data out of Chile is expected to show a month-on-month slowdown from January’s 0.4%, pushing the year-over-year reading to around 2.5% – the slowest pace since August 2020.
Banco Central del Uruguay meets on Tuesday after delivering a 100 basis point cut to 6.5% in January. Uruguay is also serving February’s inflation reading, which slowed to 3.46%, the lowest target for three straight months.
The main event from Brazil is the fourth quarter of 2025 and the final output results, which are expected to once again highlight the central bank’s inconsistent monetary policy on Latin America’s No. 1 economy.
The annual reading will likely come in just below the third quarter’s 1.8% print, while economists see full-year growth in 2025 slowing to around 2.3% from 3.4% in 2024, which would be the lowest since 2020’s -3.3% before the pandemic.
Brazil also reports industrial production and the national unemployment rate, which reached a record low of 5.1% in December.
Heading into the weekend is Colombia’s inflation, which likely rose slightly from the expected jump to 5.35% in January.
The 23% hike in minimum wages that was suspended by the Supreme Court in mid-February and reinstated by decree less than a week later completely beat expectations and analysts’ estimates.
— With contributions from Charlie Duxbury, Beryl Eckman, Brian Fowler, Laura Dillon Cain, Monique Winnick, Piotr Skolimowski, Robert Jameson and Mark Evans.
(Update with Nagel, head of the Bundesbank in the EMEA segment)
