Free Trial
CROSS ASSET

ALL EYES on NFP coming up

BOE

Analyst Views 5/5 (Hakwish to Dovish)

COPPER TECHS

(U2) Corrective Cycle Exposes The 50-Day EMA?

BOE

Analyst Views 4/5 (Hakwish to Dovish)

Real-time Actionable Insight

Get the latest on Central Bank Policy and FX & FI Markets to help inform both your strategic and tactical decision-making.

Free Access

ADP Reports Postponed, Will New Methodology Be Better NFP Predictor?

US DATA
ADP have announced they are pausing their monthly Employment Reports in order to implement a new methodology, and will not issue a new one until Aug 31 (the Jul 7 and Aug 3 releases are cancelled).
  • Market-wise, the ADP Employment Report has been seen as a somewhat useful indicator of the general direction of monthly nonfarm private payrolls which typically comes out a day or two later.
  • But it hasn't historically been seen as a particularly reliable signal, not least because prior months are often revised significantly due to their methodology - it's a model-based indicator that takes into account their own proprietary payrolls data and previous months' nonfarm payrolls readings, among other inputs.
  • The new methodology is being designed with the Stanford Digital Economy Lab in order to emerge with "a more robust, high-frequency view of the labor market and trajectory of economic growth".
  • ADP often gets market attention but is largely shrugged off quickly, so it will be interesting to see over time if the new data and methodology makes it a better predictor of NFPs going forward (and therefore more market-moving).
180 words

To read the full story

Why Subscribe to

MarketNews.com

MNI is the leading provider

of news and intelligence specifically for the Global Foreign Exchange and Fixed Income Markets, providing timely, relevant, and critical insight for market professionals and those who want to make informed investment decisions. We offer not simply news, but news analysis, linking breaking news to the effects on capital markets. Our exclusive information and intelligence moves markets.

Our credibility

for delivering mission-critical information has been built over three decades. The quality and experience of MNI's team of analysts and reporters across America, Asia and Europe truly sets us apart. Our Markets team includes former fixed-income specialists, currency traders, economists and strategists, who are able to combine expertise on macro economics, financial markets, and political risk to give a comprehensive and holistic insight on global markets.
ADP have announced they are pausing their monthly Employment Reports in order to implement a new methodology, and will not issue a new one until Aug 31 (the Jul 7 and Aug 3 releases are cancelled).
  • Market-wise, the ADP Employment Report has been seen as a somewhat useful indicator of the general direction of monthly nonfarm private payrolls which typically comes out a day or two later.
  • But it hasn't historically been seen as a particularly reliable signal, not least because prior months are often revised significantly due to their methodology - it's a model-based indicator that takes into account their own proprietary payrolls data and previous months' nonfarm payrolls readings, among other inputs.
  • The new methodology is being designed with the Stanford Digital Economy Lab in order to emerge with "a more robust, high-frequency view of the labor market and trajectory of economic growth".
  • ADP often gets market attention but is largely shrugged off quickly, so it will be interesting to see over time if the new data and methodology makes it a better predictor of NFPs going forward (and therefore more market-moving).