US to Release December ADP Employment Report Tonight, Expected to Show 47,000 Job Additions

The US will release the December ADP Employment Report tonight at 9:15 PM ET. The report is expected to show that the private sector added 47,000 jobs in December. Automatic Data Processing, the firm behind the report, provides HCM and payroll services to over 1.1 million clients globally.

The report is closely watched as a precursor to the official Nonfarm Payrolls data, which is typically released two days later. A strong ADP reading could signal improved labor market conditions and raise expectations for a tighter Federal Reserve policy. Traders often use the ADP data to form early positioning ahead of the more comprehensive BLS report.

Market expectations for the report are split between a 45,000 and 47,000 job increase. A reading above 45,000 would likely be seen as positive for the US Dollar. The US Dollar Index has shown a weak bearish trend in early 2026, though it remains near three-week lows.

Why Did This Happen?

The ADP Employment Change is seen as a reliable gauge of private-sector employment. A high reading is traditionally considered bullish for the US Dollar because it suggests a stronger labor market and potentially higher inflation. A strong labor market typically supports consumer spending and economic growth, both of which are key drivers for a stronger currency.

The ADP report is compiled by Automatic Data Processing, the largest payroll processor in the US. It measures the number of people employed in the private sector. A consistent rise in employment data increases inflationary pressures, which could prompt the Federal Reserve to raise interest rates.

What Are Analysts Watching Next?

The US Dollar Index is currently near key technical levels. Analysts are watching whether the DXY can break and hold above 98.75, which would signal a potential reversal of the bearish trend. A failure to break above this level may result in renewed downward pressure on the index.

In addition to the ADP report, traders are also monitoring the Fed's rate decision outlook. The probability of a rate cut in January has increased slightly to 17.7% according to the CME Group's FedWatch Tool. However, any significant upside in the employment report could delay rate cuts and strengthen the USD.

Employment trends have broader implications for monetary policy. A tight labor market can lead to higher wage growth, which in turn increases consumer spending and inflationary pressures. The Fed's dual mandate of achieving price stability and fostering full employment shapes its interest rate policy.

Investors and traders are advised to monitor the ADP report for early signals about the labor market's health. A strong reading may influence positioning in USD pairs and the broader US macroeconomic outlook.