ADP employment preview

ADP employment data to be released at 13:15 GMT is today's most vital dockets from US to be watched by market participants. This is report is for January, at time of heavy market turmoil.

What is ADP employment?

• The report is a measure of non-farm private sector employment which is obtained by utilizing an anonymous subset of roughly 400,000 U.S. businesses which are clients of ADP.

• This data is a very good measure of employment strength of the economy and a good precursor of Nonfarm payroll data.

Previous performance -

• Non-farm private sector employment grew at 257,000 in December. In November payroll grew by 217,000.
• Small business sector hiring at 95,000.
• Employment in franchise increased by 48,600.
• 2,000 jobs were gained in manufacturing sector.
• 23,000 jobs were added in goods producing sector.
• Construction sector added 24,000 on payroll.
• 13,000 jobs were added in financial activities.
• Services sector is main job provider. Payroll added 234,000 people in December.

Expectation Today -

• Headline number is expected to rise to 195,000 as per median estimate.

Market Impact -

• Any gain above 200,000 will be considered to be very good and Dollar might gain momentum because it will not only beat estimates but would show market turmoil had no effect on payroll gains.
   
• Data below 150,000 likely to give rise to concerns regarding US economic prowess and might lead to risk aversion as well as slide in Dollar.
   
• All in all, this is a vital piece of docket but unlikely to change much in terms of policy expectations, especially if it on the upside.

Dollar index is currently trading at 98.67, down -0.15% for the day so far.