Ahead of the FOMC - research note highlights "strong downside risks to January payrolls"

Earlier preview notes are here:

• Goldman Sachs expect FOMC rate hikes in March, June, Sept and Dec but the risk is for more
• Société Générale - "Fed is likely to push back"
• Scotia expects a Federal Reserve lift-off rate hike in March
• Federal Reserve FOMC meeting this week -BoA expect on hold
• Tomorrow's FOMC likely to trigger another leg of USD rally - BofA

• One stumble from Powell tomorrow and it's curtains for this market

Something to consider going into this meeting is highlighted by BoA, potential weakness of the labour market in January. Analysts at the bank not that the Omicron outbreak was a heavy negative for labour supply be cause or workers required to isolate:

• 8.75m people reported not working because they were caring for someone or sick with Covid. This is up from 2.96mn on December 14

Thus:

• We see strong downside risks to January payrolls

The FOMC will be aware of this and while its 'transitory' (cough) it'll be a factor in discussion keeping the committee a little less hawkish (for now) than otherwise.