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Morning Notes — Next


September 2, 2021

The significance of tomorrow’s payroll number hasn’t diminished, but expectations are lower than they were two weeks ago, which skews bond yield risk to the upside on a larger print.  Consensus has recently declined to +725,000 (+943,000 last month), but whisper numbers are closer to +650,000 and will likely drift lower in the runup to the 5:30am PT release. Fed members have used the past two monthly reports to support a December taper, but anything north of +350,000 will likely keep taper timing unchanged as the Fed looks through any delta-induced soft patch. The Fed hasn’t discussed dollar amounts/pace, but consensus is looking for $15B/mo.

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