Could US ADP forewarn a worse-than-expected NFP tonight? USD/JPY could extend its decline further.

  • US ADP (Automatic Data Processing) Non-Farm employment change came in slightly better than forecast at 20.2 million versus forecast of 20.5 million.
  • This was because many in the private sector were forced to close shutter during a nationwide shutdown to slow the coronavirus.
  • The stunning amount of job losses foreshadows what’s expected to be a similarly huge decline in NFP tonight.
  • US ADP might have undercounted the number of lost jobs as the survey counts individuals as employed as long as they are on the payroll, even if their hours have been reduced to zero. Furthermore, ADP doesn’t include government jobs.
  • USD/JPY could extend its decline further towards 105.30 tonight after NFP announcement.
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Fullerton Markets Research Team

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