20,000 jobs were lost in January according to the Bureau of Labor Statistics. The unemployment rate fell from 10.0% to 9.7%. This will surely grab headlines...

JAN NONFARM PAYROLLS -20,000 (CONSENSUS +5,000) VS DEC -150,000 (PREV -85,000)
JAN JOBLESS RATE 9.7 PCT (CONS 10.1 PCT) VS DEC 10.0 PCT (PREV 10.0)

 JAN AVERAGE HOURLY EARNINGS +0.3 PCT (CONS +0.2) VS DEC +0.2 PCT, TO $18.89 VS DEC $18.84
JAN YEAR-ON-YEAR AVERAGE HOURLY EARNINGS +2.5 PCT
JAN AVERAGE WORKWK 33.3 HRS (CONS 33.2) VS DEC 33.2, FACTORY 40.8 VS 40.6, OVERTIME 3.5 VS 3.4
JAN GOODS-PRODUCING JOBS -60,000, CONSTRUCTION -75,000 
JAN SERVICE-PROVIDING JOBS +40,000, RETAIL +42,000, GOVT -8,000, CENSUS ADDED 9,000 TEMPORARY JOBS
JAN AGGREGATE WEEKLY HOURS INDEX +0.3 PCT VS DEC UNCH

NOV NONFARM PAYROLLS REVISED TO +64,000 FROM +4,000, OCT REVISED TO -224,000 (PREV -127,000)
ANNUAL REVISION CUTS 902,000 JOBS FROM MARCH 2009 LEVEL VS. EARLY OCT. ESTIMATE OF 824,000
ANNUAL REVISIONS CUTS 930,000 JOBS FROM MARCH 2009 LEVEL ON A SEASONALLY ADJUSTED BASIS
JOB LOSSES FROM APRIL-DECEMBER 2009 A CUMULATIVE 433,000 MORE THAN PREVIOUSLY ESTIMATED
US PAYROLL JOB LOSSES SINCE RECESSION BEGAN IN DEC 2007 TOTAL 8.4 MILLION
US FACTORY JOBS IN JAN RISE FOR FIRST TIME SINCE JAN 2007, AVERAGE WEEKLY HOURS HIGHEST SINCE AUG 2008

The initial reaction in the rates market:

The 3.375% coupon bearing 10 year Treasury note is -0-03 at 97-31 yielding 3.623%.

The FN 4.0 is -0-01 at 98-08 yielding 4.169% and the FN 4.5 is -0-05 at 101-04 yielding 4.388%. The secondary market current coupon is 4.344%.

UPDATED AT 9:15AM....back to flat on the day