Salient to Investors:

Stuart Hoffman at PNC Financial Services said employment was strong enough to convince central bankers to taper by $10 billion a month. Hoffman said the headcount was weak, but income earned from wages and longer hours is positive.

The median economist  expects the Fed to taper $10 billion of Treasury purchases this month, and maintaining mortgage-bond buying at $40 billion.

Dana Saporta at Credit Suisse the disappointing employment report passes the taper test and is good enough to keep the taper as the most likely scenario.

Stephen Stanley at Pierpont Securities said while unemployment fell for the wrong reasons, payroll growth was not bleak enough to delay a tapering, and expects the Fed to pare monthly purchases of mortgage bonds and Treasuries by $10 billion each.

Esther George at FRB of Kansas City said the Fed should tapering by $15 billion this month and keep future purchases split evenly between Treasuries and mortgage-backed securities.

Charles Evans at FRB of Chicago said the Fed should not taper until inflation and economic growth pick up.

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