ADP data suggests potential moderation of job market, USDOLLAR pulls back, and gold moves higher
Job creation in the US decelerated for August, as indicated by the ADP report. This suggests that the U.S. economy, which has been resilient, could potentially be entering a phase of moderation due to the increased influence of elevated interest rates.
The ADP non-farm employment change printed at 177K. This was much lower than last month's 371K, and below the forecast of 194K.Yesterday, JOLTs data also suggested a slowdown in the jobs market, coming in at 8.83m compared with an expectation of 9.49m (and less than the previous print of 9.17m).
Source: www.tradingview.com
In response to the data points, the US 2-year yield has declined (red arrows). The 2-year is a good proxy for monetary policy, as it is sensitive to changes in the cost of capital, and this suggests that the Federal Reserve's hiking cycle may have peaked.
As a result, FXCM's USDOLLAR basket is showing two days of decline (blue arrows), and gold (XAUUSD) is showing two days of appreciation (green arrows).
There are still other important data points scheduled for this week. These include tomorrow's core PCE release and Friday's non-farm employment change. These are also likely to affect the 2-year yield.
Russell Shor
Senior Market Strategist
Russell Shor is a Senior Market Strategist at FXCM, having been promoted to the role in 2025 in recognition of his depth of insight and consistent delivery of high-impact market analysis. He originally joined FXCM in October 2017 as a Senior Market Specialist.
Russell holds an Honours Degree in Economics from the University of South Africa, is a certified FMVA®, and a full member of the Society of Technical Analysts (UK). With over 20 years of experience in financial markets, his work is renowned for its clarity, precision, and strategic value across asset classes.
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