Daily Brief, Dec 4: Economic Events Outlook – Eyes on BOC & ADP!

Good morning, traders.

On Wednesday, the US dollar traded mostly steady against most major currencies, after showing a dramatic dip on weaker than expected US manufacturing activity data and reviewed trade war sentiments.

Trading is all about the US dollar today amid dollar-related economic events, while the calendar is muted from global economies. Today the focus is likely to remain on the US ADP Non-farm payroll, ISM Non-Manufacturing, and Crude Oil inventories, which are due during the US session today.

The ADP is considered an advance NFP report, thus carries much importance. The ADP is expected to be positive, and it may drive price action in gold and other dollar-related pairs during the US. Session. Meanwhile GBP pairs will be eyeing final Services PMI figures, which are expected to stay below 50, keeping bearish pressure on GBP.

ADP Non-Farm Employment Change – 13:15 GMT

This data provides an early look at employment growth, usually two days ahead of the government-released employment data that it’s designed to mimic. Source changed series calculation formula in February 2007, December 2008, and November 2012 to better align with government data.

The Automatic Data Processing, Inc. is expected to release a slight surge in data from 140K to 125K for the month of November. Job creation is an essential leading indicator of consumer spending, which accounts for a bulk of overall economic activity. Weaker data may drive bearish sentiments for the upcoming US NFP figures, which are due on Friday.

At 15:00 GMT, the Bank of Canada will be releasing the Overnight Rate along with BOC Rate Statement. It’s widely expected to keep the interest rate steady at 1.75%.

There’s a sort of herding behavior in the market. Central banks are following the footsteps of the Federal Reserve. Bank of Japan, People’s Bank of China, European Central Bank, Bank of England, and now the Bank of Canada are also shifting their monetary policy from dovish to hawkish. The Canadian dollar is likely to trade with a bullish sentiment due to no rate cut expectations ahead.

ISM Non-Manufacturing PMI – 15:00 GMT

The Institute for Supply Management is due to report ISM non-manufacturing PMI figures. Fellas, don’t get confused with the name; it’s non-manufacturing, which means services PMI in other words.

Benchmark rule remains the same, above 50.0 indicates industry expansion, below indicates contraction.

So far, US businesses in the non-manufacturing sector have been expanding at a modest pace and facing the headwinds that have beaten manufacturing. The consensus estimate is 54.5, a number that bestows a robust rate of development though that would be down from November’s 54.7.

That’s it for today, but do check FX Leaders economic calendar for the live coverage of these significant events.

Good luck!