USD flows: USD dips on weak ADP
ADP much weaker than expected pulling the USD lower, especially against the JPY
The USD has dipped sharply lower, notably against the JPY, after a weaker than expected ADP employment report, which showed a rise of just 37k in May, well below the 110k consensus, and slightly revised down the April rise to 60K. The USD is generally lower but the weak number has also boosted the JPY on the crosses and equities and bond yields have also fallen. In practice, the ADP number isn’t a particularly reliable guide to the official employment numbers, so we wouldn’t look for much extension of the initial move, but the USD may now have seen its peak for the week ahead of the employment data on Friday. The JPY may also have seen its low on the crosses with risk sentiment talking a hit.
