Financial Markets Daily Report12 February 2026
Yesterday's data releases showed a stronger-than-expected labour market in the US, with non-farm payrolls increasing by 130k in January and unemployment rate easing 0.1pp to 4.3%. The data reinforced market expectations that the Fed will deliver two rate cuts this year, likely starting in the summer, rather than signaling an earlier or more aggressive easing cycle.
In this context, US Treasury yields rose, flattening the curve, while euro area government bond yields continued to modestly fall, keeping peripheral spreads constant. The US dollar strengthened against major peers, with the exception of the yen, which continued to appreciate after the Liberal Democratic Party's victory in the lower house elections.
Stock indices ended up mixed on both sides of the Atlantic. In commodities markets, increasing tensions between the US and Iran pushed Brent prices higher, while gold prices slightly increased, showing reduced volatility after the massive sell-off from last week.