By Kasra Kangarloo
WASHINGTON (MNI) – The ADP employment report released Wednesday
continues to prompt upward revisions to the market consensus for Friday
morning’s payrolls result.
The ADP report suggested that 297,000 payrolls were added in
December, nearly three times the market consensus and a record high for
the data since its collection began in 2001.
Post ADP, non-farm payrolls are now expected to increase 160,000 in
the latest survey update, after expectations were originally 140,000 for
December, according to Market News International.
In comparison to ADP, other relevant data have been modest. Most
encouraging was November retail sales, which beat expectations by rising
1.2% and posting the highest level in two years. This has been at odds
with weak consumer confidence surveys for December, however.
Initial jobless claims have also trended lower, but for the survey
week intersecting with the nonfarm payrolls survey the figure was still
above the key threshold of 400,000.
Some economists have made sizable revisions to estimates for the
Labor Departments nonfarm payrolls release on Friday. Paul Dales,
economist at Capital Economics raised his estimate to an increase of
175,000, though this was only 35,000 higher than his original estimate.
“We’d be more inclined to put more weight on ADP if [other data]
had been spectacular, but thats not the case,” he said in a telephone
interview.
Scott Brown, economist at Raymond James, did not revise his
estimate for nonfarm payrolls, but added that he would not be surprised
if the consensus undershot the actual figure.
Most often cited was Barclays’ view that modeling suggests a 95%
probability of at least a 450,000 payrolls figure.
The December ISM reports for the manufacturing and
non-manufacturing sectors showed weaker indexes for employment, but
these are on a lagging basis and often described by ISM as sentiment
indicators rather than employment measures.
— Kasra Kangarloo is a reporter for Need to Know News in Washington
** Market News International Washington Bureau: 202-371-2121 **
[TOPICS: M$U$$$,MAUDS$]