This morning's release of the ADP private payroll report came in better than expected for the fourth straight month (162K vs. 140K). While this may sound like a positive omen for Friday's non-farm payrolls report, we would note that the ADP report has had a history recently of overstating the change in non-farm private payrolls from the BLS. The chart below shows the historical spread between the monthly ADP employment report and the change in non-farm private payrolls. Over the last year, the monthly ADP number has been higher than non-farm private payrolls eight times (75%), and over the last six months it has been higher than the non-farm private payrolls number five times (83%).
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