The 467,000 gain in non-farm payrolls in January is even stronger than it looks, as it came despite the spike in absenteeism driven by the Omicron virus wave and was accompanied by significant upward revisions to the gains over the preceding months. That will further fuel expectations of the Fed unleashing a 50bp hike in March. We still think that a slowdown in first-quarter GDP growth will persuade officials to start slow, although they could project a bigger cumulative tightening over the next few years.
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