USD lower but stocks higher after big misses on US ADP payrolls; EUR higher as the unemployment rate dropped

USD traded lower overnight against major counterparts especially EUR, pressured by the big misses from the labor market. Data from ADP shows that private payrolls added only 374k in August, much lower than the forecast 613k. Overnight in the Eurozone, a survey showed strong European manufacturing growth despite inflationary pressure. Moreover, unemployment also fell as expected with 350k new jobs being added. The unemployment rate across 19 countries dropped to 7.6% from 7.8% in June. EUR climbed to its one-month high at 1.1857 overnight against USD.

Due to the disappointing job data, investors are expecting a delayed schedule on interest rate hikes. At Wall Street, stocks cheered as risk appetite grew stronger. Further US data will be released in the day, including exports, imports, and trade balances. Non-farm payrolls will be released tomorrow on Friday.