ADP December 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 first key data after December FOMC, in which FED hiked rates.

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 217,000 in November. In October payroll grew by 196,000.
• Small business sector hiring at 81,000.
• Employment in franchise increased by 25,600.
• 6,000 jobs were gained in manufacturing sector.
• 13,000 jobs were added in goods producing sector.
• Construction sector added 16,000 on payroll.
• 9,000 jobs were added in financial activities.
• Services sector is main job provider. Payroll added 204,000 people in September.

Expectation Today 

• Headline number is expected to rise to 192,000 as per median estimate.

Market Impact 

• Any gain above 200,000 will be considered to be very good and Dollar might gain momentum. However large sustained push unlikely ahead of NFP on Friday.
   
• 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.
   
• Though unlikely, but any number below 120,000 will lead to some serious confusion how FED might be reading this and what would be its takes on future hikes.
   
• All in all, this is a vital piece of docket after this week's disappointing ISM.

FXCM US Dollar index is currently trading at 12200.