Canada’s economic system continued to motor on in March with the creation of practically 35,000 new jobs, as soon as once more beating economist forecasts.
Statistics Canada reported that 18,800 full-time jobs have been created in March, together with 15,900 part-time positions. That beat the census forecast of seven,500 whole positions for the month.
That additionally stored the nation’s unemployment fee at 5% for the fourth straight month. Economists had anticipated it to tick as much as 5.1%.
“The Canadian jobs market exhibits no signal of slowing,” famous James Orlando, a senior economist with TD Economics, including that that is now the seventh month of employment beneficial properties, bringing the tally to 382,000 new positions in that point.
Not solely is employment persevering with to develop, however so too are wages. Statistics Canada reported a 5.3% annual enhance in hourly wages in March.
“Continued labour market energy is boosting the incomes of Canadians, enabling them to extend their spending however the excessive rate of interest setting,” Orlando mentioned.
What it means for subsequent week’s Financial institution of Canada fee determination
“That’s not the sort of development the BoC needs to see when it’s making an attempt to make sure that inflation will get again to focus on,” he added. “Though in the present day’s report isn’t sufficient to get the Financial institution off the sidelines, the truth that nothing to this point appears to have the ability to crack the Canadian jobs market juggernaut should be worrying.”
However Marc Desormeaux, principal economist at Desjardins, mentioned we shouldn’t learn an excessive amount of into the sturdy outcomes provided that the job beneficial properties have been largely concentrated in particular industries, similar to transportation and warehousing (+41k), enterprise, constructing and different assist providers (+31k), and finance and insurance coverage (+19k).
Each TD and Desjardins anticipate first-quarter GDP to come back in at an annualized 2% and three%, respectively, which is far stronger than the Financial institution of Canada’s present forecast of 0.5%.
“Nonetheless, we nonetheless assume the Financial institution is most probably to proceed to carry charges regular at subsequent week’s assembly because it waits for the delayed results of already accomplished hikes to reach,” Desormeaux wrote. “After in the present day’s report, we suspect that policymakers will maintain the door open for extra hikes down the street.”
The Financial institution of Canada’s subsequent fee determination will happen on April 12, 2023.