Quick Update NFPayrolls

Non Farm Payrolls came in at 209k lower than the expected 231k, but the bigger data was in all of the prints for 2023, have been revised lower. April and May combined revisions saw 110k removed from their respective headline totals. We are awaiting for the first negative NFP print and that will usher in the reversal of yield curve flattening and begin the steady march back to positive sloping yield curves.

Ok in other data, late yesterday saw the FED H4 report which saw the FRB balance sheet decline $42.6Bn now below $8.3T for the first time in over 2 years. This $600Bn reduction is just 6.67%:

We also saw this CMBS chart, this arena is a gathering storm of trouble and higher interest rates, should force higher cap rates, write downs, levered fire sales etc. However there is a plethora of well capitalized buyers awaiting discounted pricing were sure:

We can see here that the US Yield curves have flattened back below the pre bank crisis earlier this year as the 2Y5Y spread is -65.6bp: