Canada unexpectedly sheds 2,800 jobs in July; jobless rate stays at 6.4%

Reuters

Canada unexpectedly sheds 2,800 jobs in July; jobless rate stays at 6.4%

9 ago. 2024, ore 1:12 GMT

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TORONTO, Aug 9 (Reuters) -Canada's economy unexpectedly shed a net 2,800 jobs in July, as gains in full-time work were offset by part-time job losses, while the unemployment rate remained at a 30-month high of 6.4%, data showed on Friday.

Analysts polled by Reuters had forecast a net gain of 22,500 jobs and the unemployment rate to rise to 6.5% from 6.4% in June.

Market reaction: CAD/

Link: https://www150.statcan.gc.ca/n1/daily-quotidien/240809/dq240809a-eng.htm

COMMENTARY

ANDREW GRANTHAM, SENIOR ECONOMIST, CIBC CAPITAL MARKETS

"The minutes from last month's Bank of Canada policy decision highlighted growing concern regarding the state of the labour market, and today's data will do little to ease those concerns even with the jobless rate holding steady. We see the Bank of Canada cutting interest rates by 25 bp (basis points) in each of the three remaining policy decisions this year."

ANDREW KELVIN, HEAD OF CANADIAN AND GLOBAL RATES STRATEGY AT TD SECURITIES

"It's a very classically mixed (report), because on the one hand, obviously losing jobs for the second month is disappointing, and on the other hand, the full- time part-time split was very favourable.

I will say, if you look at the most recent Bank of Canada minutes, they did seem quite focused on slack in the labour market. This number is not going to comfort them very much.

Both these (Canada and recent U.S. employment) numbers speak to an economy that is operating a little bit slower, perhaps going a little bit below its potential pace."

DOUG PORTER, CHIEF ECONOMIST, BMO CAPITAL MARKETS

"Maybe the most interesting aspect of this report is the fact that the unemployment rate managed to hold steady, obviously because of a big drop in the participation rate."

"So overall, I would actually say it's a mixed bag for the Bank of Canada. I don't think it really changes the bigger picture, like it certainly doesn't suggest that they have to go for even faster (rate cuts) ... On the other hand, I don't think there's anything that's really going to necessarily stop them from easing in September."

Reporting by Divya Rajagopal and Nivedita Balu, editing by Fergal Smith, William Maclean and Nick Zieminski

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