EconoTicker

Republican lawmaker Don Bacon (U.S. House member) has urged President Donald Trump to remain committed to backing Iranian protesters, arguing that Tehran is not pursuing a truly durable deal with Washington and that “real peace” only comes when Iranians secure freedom. The remarks come as Iran faces intensified unrest and heavy communications restrictions, with U.S. lawmakers separately pressing the administration to help restore internet access through anti-censorship tools and emergency coordination.

The University of Michigan survey showed a firmer consumer backdrop in February. Consumer sentiment rose to 57.3 (vs 55.0 expected, 56.4 prior) and current conditions climbed to 58.3 (vs 54.9 expected, 55.4 prior), both beating forecasts. Consumer expectations were essentially steady at 56.6 (vs 56.7 expected, 57.0 prior). On inflation views, 1-year inflation expectations fell to 3.5% from 4.0%, a dovish-positive signal, while 5-year inflation expectations ticked up to 3.4% from 3.3%, suggesting longer-run inflation concerns remain sticky. Net: better confidence and near-term inflation relief, but longer-run expectations are still elevated—keeping the Fed-sensitive inflation narrative alive for USD.

U.S. consumer credit surged to $24.05B in December, far above $9.00B expectations and up sharply from $4.70B previously. The jump signals households leaned more on borrowing into year-end—potentially supporting near-term consumption, but also raising questions about whether spending is being increasingly financed by credit as cost-of-living and rates remain elevated.

The Federal Reserve’s balance sheet increased to $6,606B from $6,588B, while reserve balances rose to $2.937T from $2.883T (about +$54B). The move signals a short-term uptick in system liquidity—likely reflecting operational factors (e.g., Treasury cash movements/settlement dynamics) rather than a structural shift away from QT. Markets will watch whether this is a one-off fluctuation or the start of a more persistent liquidity rebuild.

U.S. labor-market signals weakened sharply. Challenger job cuts jumped to 108.435K in January (vs 35.553K prior), with layoffs up 117.8% YoY (vs -8.3% previously). At the same time, JOLTS job openings fell to 6.542M in December (vs 7.200M expected, 6.928M prior), pointing to softer labor demand. Taken together, the data tilt toward cooling employment momentum—raising the market’s sensitivity to upcoming payrolls/inflation prints and how quickly the Fed can pivot without reigniting price pressures.

Russia’s central bank reserves rose to $826.8B, up from $786.9B previously—an increase of roughly $39.9B. A larger reserves buffer typically strengthens confidence in external liquidity and can help smooth FX volatility, especially alongside heavier official market operations. For RUB, the direction is broadly supportive at the margin, though markets will still watch energy revenues, sanctions constraints, and intervention intensity.

U.S. initial jobless claims increased to 231K (vs 212K expected, 209K prior), signaling a modest deterioration in the near-term layoffs picture. Continuing claims edged up to 1,844K (vs 1,850K expected, 1,819K prior), suggesting unemployed workers are staying on benefits slightly longer, though the level is close to expectations. The 4-week average rose to 212.25K (from 206.25K), reinforcing the message that claims are drifting higher, even if not yet pointing to a sharp labor-market break.

U.S. short-term Treasury funding costs were essentially unchanged. The 4-week bill auction stopped at 3.630%, flat versus the prior 3.630%. The 8-week bill printed 3.630%, a small dip from 3.635% previously (about -0.5 bps). The takeaway is a stable front end—suggesting steady cash demand and little change in near-term rate expectations.

President Donald Trump said he has had “very productive” discussions with UK Prime Minister Keir Starmer about Diego Garcia, calling the island—home to a major U.S. military base—strategically vital to U.S. national security. In a social media post, Trump said he believes Starmer’s lease deal is “the best he could make,” but warned that if the lease ever “falls apart” or U.S. forces are threatened, he would “militarily secure and reinforce” the American presence on the island, adding he won’t allow the base to be undermined by what he called “fake claims or environmental nonsense.”

U.S. January S&P Global PMIs edged higher, signaling a modest pickup in growth. The Services PMI rose to 52.7 (vs 52.5 expected, 52.5 prior), while the Composite PMI increased to 53.0 (vs 52.8 expected, 52.7 prior). Both readings remain comfortably above 50, pointing to steady expansion led by services—an incremental support for the “soft-landing” growth narrative around the USD, even as markets remain sensitive to inflation and Fed-policy risks.

U.S. total vehicle sales cooled in January to 14.90M (SAAR), missing 15.50M expectations and down from 16.00M previously—signaling a softer start to the year for auto demand. The breakdown shows all car sales at 2.60M (vs 2.67M prior) and all truck sales at 12.33M (vs 13.33M prior), with the pullback driven largely by trucks/SUVs. For the broader USD macro picture, the data lean mildly growth-negative and fit with other signs of demand normalization amid still-tight financial conditions.

U.S. private-sector job growth, as measured by ADP, fell sharply short of expectations in January, rising by just 22K versus 46K expected and 37K previously. The weak print signals a notable cooling in near-term hiring momentum and puts more weight on upcoming labor-market reads (especially the official payrolls report) for clues on whether labor demand is genuinely softening.