Data released on Friday showed the Canadian economy added 41,000 jobs in April, more than the 20,000 market consensus. The analysts of CIBC They point out that the labor market remained strong in April and warn that wage inflation, still strong, will be of particular concern for the Bank of Canada (BoC).
Notable Statements:
“The Canadian labor market remained strong in April, with employment gaining above expectations, an unemployment rate holding near record lows and wage inflation not slowing. Still strong wage inflation will be of particular concern for the Bank of Canada, as policymakers have raised concerns that services inflation will pass through to headline inflation, potentially preventing headline inflation from falling back to the 2% target, which which suggests that a hard line tone will be maintained in the next communications.”
“Job growth may not be able to match that of the workforce for much longer, as job vacancies have fallen from their highs and the Service Industries that have been hiring recently are now closer to reaching full employment relative to pre-pandemic norms. The unemployment rate should rise slightly in the second half of the year, easing some of the wage pressures that remain and allowing the BoC to gradually cut interest rates in 2024.”
“Bond yields rose after the release, with markets pricing in a slightly higher probability of another 25 basis point rate hike by the Bank of Canada before July.”
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
