Complete employment in Canada rose by 91,000 in December, in response to Statistics Canada. Nearly all of the expansion got here from full-time positions, which noticed a rise of 57,500, whereas part-time jobs additionally grew by 33,500.

Canada’s employment fee—the proportion of the inhabitants over 15 that’s employed—rose by 0.2%, marking the primary improve since January 2023.

Unemployment decreased by 0.1% to six.7% in December. The youth employment fee additionally noticed an uptick, rising by half a p.c to 14.4%, as extra younger Canadians sought work throughout the month.

Sectors experiencing important job development included instructional providers (+17,000 jobs), transportation and warehousing (+17,000 jobs), healthcare (+16,000 jobs), and finance, insurance coverage, actual property, and rental and leasing companies (+16,000 jobs).

“Regardless of all of the detrimental speak on Canada’s financial system, the nation retains including jobs. Importantly, these jobs had been largely full-time, and in cyclically delicate industries,” TD Economics’ James Orlando wrote in a analysis word.

Based on Statistics Canada, complete hours labored elevated by 2.1% year-over-year and rose by 0.5% in December. Common hourly wages additionally noticed a major rise, up 3.8%, or $1.32, to achieve $35.77.

This morning additionally noticed the discharge of sturdy employment development within the U.S., the place 256,000 jobs had been added in December, beating market forecasts of 160,000.

Because of this, each U.S. Treasuries and 10-year bond yields—which affect mounted mortgage fee pricing—surged, with the Authorities of Canada 5-year bond yield rising over 11 foundation factors to three.15%.

As RMG’s VP of Gross sales, Bruno Valko, identified in a morning word, “good financial information is often unhealthy information for mortgage rates of interest.”

“The US 10-year Treasury yield is up 10 bps as nicely to a brand new one-year excessive,” he added. “This may put upward strain on mounted mortgage charges within the U.S. and Canada.”

Robust job numbers “places a January fee minimize into query”

Economists see the surge in job development as a possible impediment to the Financial institution of Canada’s anticipated fee minimize this month.

As we previously reported, the entire Huge Six Banks are calling for a minimum of a quarter-point fee minimize this quarter, with half anticipating 50 foundation factors of easing throughout the Financial institution of Canada’s upcoming conferences in January and March.

“In the present day’s report places a January fee minimize into query,” writes Orlando, including that the Financial institution of Canada might have sufficient information post-U.S. Presidential inauguration on January 20 to find out whether or not decrease rates of interest are “essential to shore up the financial system.”

BMO’s Douglas Porter additionally believes these job features increase “significant doubt” about whether or not the Financial institution of Canada will proceed with a fee minimize in January.

Porter added that the potential menace of tariffs for 2025, together with a weak Canadian greenback and the Fed “shifting to the sidelines for a spell,” might additionally lead the Financial institution of Canada to carry off on a fee minimize.

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Final modified: January 10, 2025