The Macro Double-Header
- Max Fountain
- Feb 10
- 2 min read
If the markets appear a little twitchy recently, you’re not imagining it. After a short government shutdown in late January caused a massive backlog in federal data, we’ve just entered a week that traders call a “Macro Super Week.”
For the first time in many years, the January Jobs Report and January CPI are falling within 48 hours of each other. This is the ultimate stress test for the Federal Reserve’s “soft landing” theory. Here is what to watch at the 8:30 AM whistles this Wednesday and Friday.
On Wednesday, the Bureau of Labor Statistics will drop the January Jobs Report. At the surface level, economists are looking at a gain of 70,000+ jobs. While this is critical information, the real drama is the Annual Benchmark Revision. There is speculation on Wall Street that 2025’s employment date was overstated significantly, perhaps by as many as 800,000 jobs.
So What?
If the revisions show the labor market was “cracking” all through last year, the Fed will face lots of pressure to cut rates in March to prevent a deeper recession.
Then, Friday’s CPI report. While we have seen inflation cool significantly over the past year, this is the first clean look at 2026. This time around, there is a new variable, being the new trade tariffs on Mexico, Canada, and China that went into effect on February 1st. The headline number is not the only thing to look at. Core Goods will be equally important. If companies are already taking the new import costs into consideration and passing them on to consumers, there could be a sticky inflation print that forces the Fed to keep rates high, even if the jobs data is lacking.
To wrap up, ideally there would be a “Goldilocks” result. Job growth around +80k, and inflation at or lower than 2.5%. This would prove that the economy is cooling safely, which would then allow the Fed to eventually cut rates. On the opposite end of the spectrum falls the “Danger Zone.” A double-miss scenario that reveals over 1 million ghost jobs lost while the January inflation spikes towards 2.8% due to the tariffs. In this result, the Fed would essentially be trapped. They likely couldn’t cut rates to save jobs without making prices worse. This compilation of numbers could likely dictate the market’s direction for the rest of the quarter and can change a lot of things going on in the market.
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