USD flows: USD edges off its highs after ADP

While the ADP employment gain was slightly lower than the market anticipated, it makes little difference in terms of expectations for Friday’s employment report, as the ADP data didn’t pick up the weather-related weakness in employment in October. There is still likely to be a strong rebound in the official employment numbers. The USD has edged off its highs after the data, but we wouldn’t expect any real followthrough given that the ADP data is unlikely to be a good indicator for the payroll number son Friday.