Wednesday, October 5, 2016

Friday's Jobs Report May Cause Rate Hike Fears

See Full Report

*ADP slowed.
*Jobless claims though are very strong.
*There is a chance for a good number Friday which can confirm a 2016 rate hike. *The question is what that would mean to markets.




ADP reported a slowdown today. The numbers we prefer to track ahead of non-farm payrolls ("NFP") are jobless claims which have been strong. A strong NFP number on Friday will help confirm a rate hike in 2016.
Here's the ADP report our today.
Source: ADP
ADP reported 154,000 new jobs which was down from 175,000 in the report for August.
ADP: A So-So Shorter Term NFP Predictor
Here's how ADP has predicted NFP.
SeptOctNovDecJanFebMarAprMayJunJulAugSep
ADP171178193287193207201149181171196177154
mtm-15%4%8%49%-33%7%-3%-26%21%-6%15%-10%-13%
Non Farm Payrolls14929528027116823318614424271275151
mtm-1%98%-5%-3%-38%39%-20%-23%-83%1029%1%-45%
PredictedSo-sonoSo-sonoyesSo-soSo-soyesnonoSo-soyes


Sometimes ADP predicts NFP but sometimes it does not.
Over the longer term though ADP is a very good NFP predictor.
Source: ADP
While ADP may not catch the month-to-month moves of the NFP all the time, it does track NFP longer term.

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