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March ADP Non-Farm Employment Change at 191K; Steady but Not Impressive

The March ADP Non-Farm Employment data showed that there were approximately 191K jobs added to the US economy in March, which is up from the upwardly revised 178K in February, and pretty much in line with forecast of about 192K.

The 191K reading is a steady increase and the revision from 139K to 178K in February is not insignificant. However I think the market would be more impressed with a string of 200K+ readings. 

The ADP data is only a precursor to the more significant event risk on Friday, which is the official Non-Farm Payroll produced by the US government. There can be wide discrepancies from a month to month basis, but the trend is relatively the same. 

Here is the ADP chart going back to 2007 compared to the NFP chart from 2007:




Now eyes will be on the NFP. If we get a number that is around 200K, the market would be mildly satisfied, because the forecast is around 199K. There still could be risk-on trading, which would be USD-negative. However a nice surprise of let's say a 230K+ reading could still be risk-on, but the USD-strength might dominate and make it unclear for majors like EUR/USD, AUD/USD. USD/JPY however should rally in both of these scenarios where the reading will meet or beat expectations.