U.S. President Donald Trump posted on Truth Social that there will be "no deal with Iran except UNCONDITIONAL SURRENDER." The blunt statement crushed any remaining hope for a negotiated settlement, sending risk markets sharply lower Friday morning.
WTI crude oil surged to a multi-year high near $90 per barrel. Nasdaq futures dropped 1.8%. Bitcoin hit a fresh session low of $68,800, down 5%.
February payrolls unexpectedly decline by 92,000
The U.S. economy lost 92,000 jobs in February, while the unemployment rate ticked up to 4.4% from 4.3%. Economist Heather Long wrote on X: "Let me put this another way: The U.S. economy has lost jobs since April 2025. Total job gains from May 2025 to February 2026 are now -19,000. Companies are not hiring in the face of all of these headwinds and uncertainty."
The weak report reinforces a broader slowdown in hiring that has been building over the past year. Normally, such data would push the Federal Reserve to cut rates aggressively. But inflation remains above the 2% target, and the sharp rise in oil threatens to worsen the price outlook.
Rate cut odds stay minimal: March 4%, April 17%
Interest rate traders see little chance for an imminent cut: odds for a March cut stand at just 4%, and for April at 17%. The Fed faces a dilemma between softening labor market and sticky inflation, with soaring oil narrowing its policy options.
Markets are now absorbing a double blow of geopolitical tensions and economic slowdown. Strong crude prices could continue to squeeze risk asset valuations, while bitcoin's ability to hold above $70,000 will depend on liquidity conditions and shifting risk appetite.