Instant view: Canada's unemployment rate surges to seven-year high outside of pandemic
TORONTO (Reuters) - Canada's unemployment rate edged up to 6.6% in August, scaling a peak last seen more than seven years ago outside the pandemic years of 2020 and 2021, data showed on Friday.
The economy added a net 22,100 jobs in August, fully driven by part-time employment, Statistics Canada said. Analysts polled by Reuters had forecast a jobless rate of 6.5% and net job additions of 25,000 in August.
Market reaction:
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COMMENTARY
ANDREW KELVIN, HEAD OF CANADIAN AND GLOBAL RATES STRATEGY AT TD SECURITIES
"It's a little bit weaker than the markets expected perhaps. But really it is in line with market expectations because (it is) a moderate rebound in employment following two months of flat job growth."
DOUG PORTER, CHIEF ECONOMIST, BMO CAPITAL MARKETS
"We had said this earlier, that we think the unemployment rate was heading for 7%, and I see nothing that suggests otherwise."
"Now that school is starting it is possible, because the rising unemployment is so concentrated among youth, that wage moderation could happen in months."
"We have a slow-growing economy and a really fast-growing population, so it is the combination for the unemployment rate."
KARL SCHAMOTTA, CHIEF MARKET STRATEGIST AT CORPAY
"Bank of Canada officials seem inclined to favour easing policy in back-to-back meetings through to the early part of next year, but - as Governor Macklem hinted on Wednesday - bigger moves don't look likely at this time."
"The loonie is climbing relative to the dollar, and could extend recent gains if U.S. policy expectations continue their decline."
ANDREW GRANTHAM, SENIOR ECONOMIST, CIBC CAPITAL MARKETS
"Canadian employment rebounded slightly following two soft months, but the job gain couldn't keep up with the pace of labour force growth and the jobless rate rose more than anticipated."
"Overall, this was a slightly softer than expected report consistent with continued steady interest rate cuts from the Bank of Canada."
(Reporting by Fergal Smith, Divya Rajagopal and Nivedita Balu; Editing by Fergal Smith and Jan Harvey)
