ADP Report Expected to Show Steady Labor Market Despite Middle East Conflict

The upcoming ADP Employment Change report for July is expected to show that the US private sector added 70K new positions, following June's 98K gain. This figure will precede the more comprehensive Nonfarm Payrolls (NFP) report on Friday and has a significant impact on the US Dollar (USD). However, market attention is currently focused elsewhere due to the ongoing Middle East conflict.

The conflict has pushed Oil prices and the Greenback up during times of high tensions, but down with growing hopes for an end to the crisis. News that a deal with Iran to reopen the Strait of Hormuz could be reached as soon as Tuesday or Wednesday has led to a sharp drop in Oil prices.

The ADP report is expected to provide insight into future Federal Reserve monetary policy decisions, particularly regarding inflation levels. The central bank left its benchmark rate unchanged in July and signaled stability in the labor market.