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June's employment gains, job hunter influx clears way for rate hike

08 July 2018

StatsCan says the jobless rate moved up last month despite the addition of nearly 32-thousand new jobs across the country because almost 76-thousand more people entered the workforce.

CIBC, in its week ahead report for July 2 to 6, said "a nice rebound in Canada's labour force survey for June" would be "the last piece of the puzzle for a Bank of Canada rate hike in July".

Toronto saw its unemployment rate rise by 0.1 of a percentage point to 6.4 per cent, while Vancouver's unemployment rate was 4.6 per cent during the month.

Compared with a year earlier, total employment increased by 1.2% 214 after the creation of 90 jobs.

In all, 22,700 part-time jobs and 9,100 full-time positions were created in June.

While Canada's dollar is expected to climb over the coming year, currency strategists in a separate Reuters poll were less bullish than they were a month ago as escalating trade uncertainty competes with expected Bank of Canada interest rate hikes.

The central bank has raised rates three times since July 2017, and on May 30 said higher interest rates were warranted, dropping more cautious language about additional monetary stimulus being needed.

The unknowns include Canada's intensifying trade dispute with the United States and the challenging renegotiation of the North American Free Trade Agreement. The public sector has increased its membership by 11 800 jobs, while the private sector lost 2,000 employees.

Employment increased in Ontario, Saskatchewan, and Manitoba. At the same time, employment decreased in accommodation and food services, and in agriculture.

The May numbers show that imports expanded 1.7 per cent, while exports dipped 0.1 per cent.

The report showed that Canada's trade surplus with the US narrowed to $3.3 billion in May, from $3.7 billion April, as more imports headed north across the border and south-bound exports decreased.

June's employment gains, job hunter influx clears way for rate hike