• Manufacturing PMI expected to be stable in expansion
  • Labour market continues to percolate
  • ADP employment to revert to trend

The Institute for Supply Management (ISM) will issue its purchasing managers index (PMI) for April on Wednesday May1st at 10:00 am EDT, 14:00 pm GMT.

Automatic Data Processing (ADP) will release its April report on private payrolls at 8:15 am EDT, 12:15 pm GMT on Wednesday May 1st.


The ISM manufacturing PMI is expected to slip to 55.0 in April from 55.3 in March. The employment index will drop to 55.8 in April from 57.5.  The new orders index was 57.4 in March and 55.5 in February.  

The clients of ADP are projected to add 180,000 new positions in April.

US Manufacturing: Not exceptional but still very good

The US manufacturing sector has had a very good two years with optimism, employment and orders running far ahead of the averages over the past 50 years.

The manufacturing PMI index reached 60.8 in August last year. That was the highest since May 2004. The 12-month moving average last November was 59.22, the best since September and October 2004 and the second highest period since 1984.


The employment and new orders indexes have had similar if less dramatic success since the 2016 election.  

The exceptional times came to an end late last fall when all three indexes saw sharp declines that may have been exacerbated by the government shutdown in January but were not precipitated by it. 

The overall PMI index dropped from 60.8 in August to 54.3 in December and 54.2 in February. It recovered to 55.3 in March.

Employment reached a post-recession top of 59.5 in October 2017 drifted to 58.2 in September 2018 plunged to 52.3 in February and then came back to 57.5 in March. New orders were at 64.5 in August 2018, plummeted to 51.3 in December and then climbed back to 57.4 in March.



Although the heights of the last two years have been deserted US manufacturing remains in excellent condition. All the major PMI indexes are well above the 50 division between expansion and contraction.

With the US economy accelerating to 3.2% annualized growth in the first quarter, hiring strong, consumer and business spending picking up and consumer optimism restored there is every reason to expect purchasing managers to sense the uptick in growth and to sense and act  accordingly

The ISM Index is nationwide survey of more than 300 purchasing and supply executives conducted monthly by the Institute for Supply Management.

ADP Employment: The private side of NFP

Following the disappointing March result of 129,000 new hires, ADP’s private sector firms are expected to resume trend employment with 180,000 new employees in April.

The ADP payroll report is the lead into the Labor Department’s Employment Situation Report, commonly known as Non-Farm Payrolls, NFP or just payrolls which will be issued this Friday May 3rd at 8:30 am EDT, 12:30 pm GMT. 

The ADP report, normally issued two days before payrolls each month is a useful precursor to the Labor Department numbers for the overall economy. 

The April non-farm payrolls are forecast to add 180,000 new employees.

The government payroll report details the US labor market providing figures on total US employment and new hires. The Bureau of Economic Analysis (BEA), a division of the Labor Department, records average hourly earnings monthly and per year, average work week (hours) , labor force participation rate and many other statistics.  The report gives a complete picture of the US labor market and is the best known and most widely traded US economic statistic.

The chief difference between the two tabulations is that ADP charts the hiring of its own clients, the 411,000 US firms employing nearly 24 million workers who use its data services.  Non-farm payrolls covers the entire US economy including government employment at the local, state and federal levels.

There is a directional correlation between the private ADP figures and the overall US employment figures. The two numbers usually vary in the same direction though the amount of the rise or fall is not well correlated.  March saw a relatively rare disconnect, NFP rose from 33,000 to 196,000 and ADP fell from 183,000 to 129,000.


US economy: The answers remain the same

The economic conditions that determine the outlook of the supply executives of the ISM surveys also set the hiring criteria for the private firms of the ADP report.  The opinions of the ISM respondents are flip side of the hiring decisions of the ADP clients.  No doubt some of them are the same people.  

The resurgence in US growth in the first quarter, the recovered consumer optimism and most importantly the surge in consumption in the past three months point to a far stronger economy than was anticipated earlier in the year and much better prospects for the rest of 2019. The hallmark of the past two years has been the strength of the labor market. That is slated to continue.





Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Feed news Join Telegram

Recommended Content

Recommended Content

Editors’ Picks

EUR/USD steadies near 1.0550, looks to post modest weekly gains

EUR/USD steadies near 1.0550, looks to post modest weekly gains

EUR/USD has lost its bullish momentum after having climbed above 1.0570 with the initial reaction to the US data in the American session and retreated toward the mid-1.0500s. On a weekly basis, the pair remains on track to close in positive territory. 


GBP/USD struggles to hold above 1.2300

GBP/USD struggles to hold above 1.2300

GBP/USD has edged lower following a jump above 1.2300 in the early American session on Friday. The market mood remains upbeat ahead of the weekend with Wall Street's main indexes posting strong daily gains on upbeat US data. 


Gold stays below $1,830 as US yields edge higher

Gold stays below $1,830 as US yields edge higher

Gold continues to fluctuate below $1,830 on Friday and looks to close the second straight week in negative territory. Fueled by the risk-positive market environment, the benchmark 10-year US Treasury bond yield is up more than 1% on the day, limiting XAU/USD's upside.

Gold News

Why Cardano could surprise over the weekend

Why Cardano could surprise over the weekend

ADA  set to close out the week with a gain on the workday trading week and over the weekend? Central banks signaled that the rate hike cycle is ending, meaning less stress and tight conditions for trading, opening up room for some upside potential with Cardano set to pop above $0.55 and test a significant cap.

Read more

FXStreet Premium users exceed expectations

FXStreet Premium users exceed expectations

Tap into our 20 years Forex trading experience and get ahead of the markets. Maximize our actionable content, be part of our community, and chat with our experts. Join FXStreet Premium today!