June change in ADP came in at 176K, significantly above the
95K consensus. In addition, May ADP
figure was revised up to 136K from 133K.
Whether the June ADP number means that tomorrow’s NFP will be much
higher than we expect, remains to be seen; however, the chances of that
happening have increased. NFP could come
in between 120K and 150K. The Street
expects 100K; and our estimate is 74K. We must note that although ADP net change was 133K (original figure) in May, the NFP came in at a very disappointing 69K; but June's surprisingly high ADP cannot be ignored.
Last week's initial claims print is 374K, below the 385K consensus. In addition, surprisingly, for the first time this year, the prior week's initial claims were revised lower by 2,000.
Although better than expected, the figures above may cast doubt on whether Bernanke will launch QE3. In addition, China's and ECB's rate cuts, and BoE's additional easing could lower chances of a QE3, as many economists believe that the issue lies outside of the U.S. (EZ and slower growth in emerging markets) and if it is being 'addressed', then no need for a Fed QE3.
Last week's initial claims print is 374K, below the 385K consensus. In addition, surprisingly, for the first time this year, the prior week's initial claims were revised lower by 2,000.
Although better than expected, the figures above may cast doubt on whether Bernanke will launch QE3. In addition, China's and ECB's rate cuts, and BoE's additional easing could lower chances of a QE3, as many economists believe that the issue lies outside of the U.S. (EZ and slower growth in emerging markets) and if it is being 'addressed', then no need for a Fed QE3.
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