The Canadian economy created 153,700 net jobs in November, well above analysts’ expectations of 35,000, while the unemployment rate fell to 6.0%, beating the consensus estimate of 6.6% and approaching the 5.7% unemployment rate in February 2020, Statistics Canada said.
“I think the job market is tighter than the Bank of Canada suggests,” said Derek Holt, vice president of capital markets economics at Scotiabank, highlighting the wage gains, which are rising. are accelerated to 3.0% over the year, against 2.1%. in October.
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“We have 186,000 jobs above pre-pandemic levels. So the Bank of Canada’s narrative that we still have a lead, in terms of a labor market recovery, seems weaker at the moment, ”added Holt.
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The Bank of Canada signaled in October that it could start raising rates as early as April 2022. Since then, massive flooding in British Columbia has hampered trade through Vancouver and the Omicron variant of the coronavirus has become a new global threat.
These factors are creating uncertainty for the central bank and it is unlikely to change the tone significantly in its rate decision next week, economists said.
“If we didn’t have the variant that brings some uncertainty to the outlook, I think almost all of the systems would be in place for the Bank to start tightening things up early enough in 2022,” said Doug Porter, chief economist. at BMO Capital Markets.
Employment in Canada increased in both the service and goods-producing industries, and earnings were split roughly evenly between full-time and part-time work. Total hours worked increased 0.7%, returning for the first time to pre-pandemic levels.
The Canadian dollar was trading 0.4 percent higher at 1.2760 for the greenback, or 78.37 cents US.
(Reporting by Julie Gordon in Ottawa, additional reporting by Steve Scherer in Ottawa and Fergal Smith in Toronto; Editing by Toby Chopra and Richard Chang)
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