OTTAWA. — Canada’s unemployment rate fell slightly to 6.9 percent in June as the wholesale and retail trade sectorsas well as manufacturing, healthcare and social assistance all saw surprise job growth, data showed on Friday.
The economy added 83,100 new jobs in June, the first net increase since January, Statistics Canada said. Most of the employment growth was in part-time work.
Analysts polled by Reuters had estimated the unemployment rate would tick up to 7.1 percent from 7 percent in May, with no job additions. The jobs report usually has a standard error of around 32,000 between two consecutive months.
Friday’s release was the final jobs report before the Bank of Canada’s monetary policy decision on July 30, and better-than-expected unemployment and job addition numbers are likely to tilt the bank towards another hold in its policy rate.
June inflation data is due out next week.
Money market bets for a rate cut this month shrank to below 20 percent following the labor force survey.
On Thursday, rate cut bets were at 30 percent after US President Donald Trumpsaid he would impose 35 percent tariffs on Canadian imports from Aug. 1, up from 25 percent previously threatened.
“While the unemployment rate is still elevated, the strength in other measures in this report clearly diminishes the odds of a BoC cut in July,” Katherine Judge, economist at CIBC Capital Markets wrote in a note.
The Canadian dollar CAD= was trading down 0.12 percent to 1.3671 to the US dollar, or 73.15 US cents. Bond yields on the two-year government bonds CA2YT=RR were up 1.9 basis points to 2.715 percent.
While the number of unemployed Canadians in June changed only slightly from May, it was up 9 percent to 128,000 on a year-over-year basis. And more than one in five unemployed people had been searching for work for 27 weeks or more in June, an sharp increase from a year ago.
