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ADP reported a gain of 158K jobs in the American private sector during October. Expectations stood on a gain of 138K jobs, but it is important to stress that the company made significant changes to its formula. This could have lowered real expectations, especially as the new formula already triggered an early revision of September’s data to the downside.

So, this positive surprise on top of real lower expectations is very good news for the US jobs market. Expectations for Friday’s NFP will probably be increased now.

EUR/USD traded around 1.2960 and USD/JPY was around 80 just before the release. The dollar is weakening against both currencies after the release.

Update: US jobless claims stand at 363K – marginally better than expected. Last month’s figure was slightly revised to the upside.

Another update: ISM Manufacturing PMI rose to 51.7 points, but the employment component slid.

The lower correlation between the ADP report and the private sector portion of the official Non-Farm Payrolls report prompted a change in the formula used to calculate the figure. ADP partnered with Moody’s in order to improve the report.

The announcement of the update included a revision to September’s figure: 88K instead of the 162K originally reported  – the publication here included a big question mark about the correlation between the two figures.

Two more important jobs-related figure are due: weekly jobless claims and the ISM Manufacturing PMI (and its jobs component). See how to trade manufacturing PMI with USD/JPY.