To The Moon

JPMorgan Chase has recommended that investors take profits on long positions in two-year U.S. Treasury notes, cautioning that stronger-than-expected employment data could limit the market's expectations for Federal Reserve policy easing. Strategists, including Jay Barry, noted in a report that if the bank's prediction of 75,000 new nonfarm payrolls in March proves accurate, the market may scale back its expectations for near-term interest rate cuts by the Fed. The market consensus had anticipated an increase of 65,000 jobs. Market pricing has largely aligned with JPMorgan's view that the Fed will keep interest rates unchanged throughout 2026. However, the bank highlighted remaining risks: a rise in oil prices to $125 or higher could trigger what it described as an "inherent asymmetry in central bank policy reaction functions." In the event of a worsening oil shock, the Fed might adopt a more dovish stance.