Finance
Morning Bid: Fed under pressure as layoffs mount
Published by Global Banking & Finance Review®
Posted on February 6, 2026
3 min readLast updated: February 6, 2026
Quick Summary
The Federal Reserve is under pressure as layoffs rise and market turmoil spreads globally, prompting traders to anticipate potential policy easing.
Federal Reserve Faces Pressure Amid Rising Layoffs and Market Turmoil
Impact of Layoffs on Federal Reserve Policy
A look at the day ahead in European and global markets from Gregor Stuart Hunter.
Current Market Trends
It's Jobs Friday and there is no jobs report. With non-farm payrolls delayed by a U.S. government shutdown - again - and a selloff on Wall Street going global, markets are anxious.
Key Economic Data Releases
Traders are increasingly betting the Federal Reserve might ease policy at its next meeting, following fresh signs of economic stress in the labour market.
Earnings Announcements
A survey from global outplacement firm Challenger, Gray & Christmas showed layoffs announced by U.S. employers surged in January to the highest level for the month in 17 years.
Though pricing implies a strong possibility the Fed will remain on hold, funds futures are pricing a 22.7% probability of a 25-basis-point cut at the U.S. central bank's next two-day meeting that ends on March 18, compared with a 9.4% chance a day earlier, according to the CME Group's FedWatch tool.
For now, a selloff for global stocks is into its third day and emerging markets are looking shaky. Korean shares led the way after an early 5% dive in the KOSPI triggered a trading halt.
It wasn't all bad though, with Japan's Nikkei 225 eking out a 0.6% gain as stocks rally into Sunday's election.
In early European trades, pan-region futures were last down 0.1% and FTSE futures were down 0.6%, though German DAX futures were up 0.1%.
In an indication that investor confidence is still holding up, two of the leading speculative trades of the year both found a bottom during the Asian session.
After plummeting through the $70,000 mark on Thursday, bitcoin has overturned a 4.9% decline to trade 4.2% higher at $65,778.90.
Not to be outdone, after a 19% plunge on Thursday, silver reversed a 10% decline and is now trading up a placid 3.5% at $73.71.
There's been little respite for big tech, however. Amazon shares tumbled 15% in after-hours trading after it projected on Thursday a surge of more than 50% in capital expenditures this year.
Key developments that could influence markets on Friday:
Earnings announcements:
Philip Morris International, Cboe Global Markets, Societe Generale, Telenor
Economic data:
Germany: Industrial output and trade balance for December
UK: Halifax house prices for January
France: Reserve assets and trade balance for January
Debt auctions:
UK: 1-month, 3-month and 6-month government debt
(Editing by Jacqueline Wong)
Key Takeaways
- •Federal Reserve faces pressure due to rising layoffs.
- •Market turmoil is affecting global economic stability.
- •Traders anticipate potential Fed policy easing.
- •Global stocks experience a significant selloff.
- •Bitcoin and silver show signs of recovery.
Frequently Asked Questions about Morning Bid: Fed under pressure as layoffs mount
1What is the Federal Reserve?
The Federal Reserve, often referred to as the Fed, is the central banking system of the United States, responsible for implementing monetary policy, regulating banks, and maintaining financial stability.
2What are layoffs?
Layoffs refer to the termination of employees from their jobs, usually due to economic conditions, company restructuring, or financial difficulties faced by the employer.
3What is monetary policy?
Monetary policy is the process by which a central bank, like the Federal Reserve, manages the supply of money and interest rates to achieve economic objectives such as controlling inflation and stabilizing currency.
4What are earnings announcements?
Earnings announcements are reports issued by publicly traded companies that disclose their financial performance over a specific period, including revenue, profit, and earnings per share.
