USD Strengthens after ADP Reports 209 Thousand Jobs Added in March
THE TAKEAWAY: U.S. Companies Added 209 Thousand Jobs in March > Labor Market Conditions Continued to Improve that Push Consumer Sentiment and Confidence Up> U.S. Dollar Strengthens
Job creation in the private sector was more robust than expected in March, pointing to some firming of labor market conditions. The monthly ADP National Employment report issued today showed that U.S. companies added 209 thousand jobs last month, following a revised 230 thousand increase in February and 182 thousand gain in January. Meanwhile, thirty-eight economists surveyed by Bloomberg News had anticipated a gain of 206 thousand. Monthly gains in employment during the first quarter averaged 207 thousand jobs compared to 156 thousand per month over all of 2011.
Job growth was widespread in all major sectors in the economy and cross payrolls of all sizes. Service producers generated 164 thousand jobs, after adding a revised 183 thousand in March. Factories added 23 thousand jobs last month while goods producers hired 45 thousand more employees in the month. Meanwhile, employment in the construction industry picked up 13 thousand and employment in the financial services grew 8 thousand.
Regarding to size base, small firms registered the biggest increase of 100 thousand new hires in March compared with 113 new jobs in the preceding month. Medium firms reported 87 thousand new payrolls, lower than95 thousand added in January. Large firms created 22 thousand jobs last month, same with the number of jobs added in the prior month.
EURUSD 1-minute Chart: April 4, 2012
Chart created using Strategy Trader- Prepared by Trang Nguyen
The U.S. dollar gains ground versus most of its major counterparts except its Japanese trading partners ahead of the North American trade today. In the minutes following the stronger-than-expected ADP employment report, the dollar extends gains versus major currencies. As can be seen from 1-minute EURUSD chart above, the single currency traded 40 pips lower versus the greenback from 1.3140 to 1.3110.
Since the private employment change is considered a precursor to the non-farm payrolls number, a favorable figure today suggests that March non-farm payrolls reading released this Friday might beat expectations and might bring the national unemployment rate down. Economists from Bloomberg survey projected a 227 thousand nonfarm payrolls added last month and the unemployment rate to be held at 8.3 percent.
--- Written by Trang Nguyen, DailyFX Research Team for DailyFX.com
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DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.