Strong ADP but weak correlation to NFP


U.S. ADP reported private payrolls increased 234k in January from a revised 242k gain in December (was revised down from 250k). The service sector added 212k and the goods sector rose 22k. In the former, trade/transport rose 51k and helped pace the headline gain. Education and health added 47k, while employment in leisure and hospitality increased 46k. For the goods sector, manufacturing was up 12k and construction rose 9k. The headline is stronger than expected and is likely to limit any further declines in Treasury yields, but the report doesn’t really correlate strongly with the monthly Non-Farm Payroll (NFP) figure which is due Friday. The Reuters Poll has a consensus for NFP to be 180K.  The “as reported” ADP figures have overshot private payrolls in every month since the methodology change of October 2016 except April, June, and November of 2017, leaving an average overshoot of 44k and an average monthly 2017 gain of a solid 212k, versus 168k for NFP private payrolls.

The dollar edged up after the better ADP jobs number, taking EURUSD down a few points to 1.2448 before recovering to 1.2466.



Click here to access the HotForex Economic calendar.

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE! The next webinar will start in:

Stuart Cowell

Senior Market Analyst


Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.