ADP · 8-K · 20260729PR000025

Interest Rate Environment

AUTOMATIC DATA PROCESSING INC · 2026-07-29 · Importance 64 · Surprise 40

Interest on funds held for clients increased 14% year over year to $1.4 billion in fiscal 2026, while the average client-funds yield rose 20 basis points to 3.4%. ADP bases its fiscal 2027 interest assumptions on Fed Funds futures contracts and forward yield curves as of July 28, 2026. The forecast uses a 4.4% blended rate for new purchases across client and corporate extended and client long portfolios. Fiscal 2027 interest on funds held for clients is projected at $1.540 billion to $1.560 billion, based on 3% to 4% growth in client-funds balances and an average yield of approximately 3.7%.