July ADP employment growth slowed sharply to 44K, missing forecasts and weighing on the USD as traders await Friday’s Nonfarm Payrolls report.
The British Pound rose 0.12% against the US Dollar to 1.3467 on Wednesday, extending the greenback’s losses after softer-than-expected US jobs data. The ADP Employment Change report showed private payrolls grew by 44K in July, down from 98K in June and below the 70K forecast. Education and health services added 36K jobs, while leisure and hospitality shed 11K, partly due to post-World Cup adjustments.
The ISM Services PMI remained in expansion at 54.1, though below the 54.5 estimate. The employment sub-index contracted to 47.4, while prices paid rose to 70.3, marking the 110th consecutive month of expansion. Markets now focus on Friday’s Nonfarm Payrolls, with expectations of 80K jobs added in July, up from June’s 57K, and an unchanged unemployment rate of 4.2%.
Federal Reserve officials remain divided, with Minneapolis Fed President Neel Kashkari advocating gradual rate hikes, while Kansas City Fed’s Jeffrey Schmid signals continued tight monetary policy.