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Canada employment rose in June as unemployment fell to 6.5%

Employment increased by 18.2k, while full-time jobs grew by 131k year over year and average hourly earnings rose 3.3%.

Reported · Written up by our desk · Economy

Canada’s labor market showed resilience in June, with employment up 18.2k versus expectations of a 10.0k gain, after May’s much larger 87.8k rise.

The unemployment rate fell to 6.5% from 6.6%, marking a second straight monthly decline. The employment rate inched up 0.1 percentage point to 60.8%, and labor force participation held at 65.0%, indicating the drop in unemployment was driven by stronger hiring rather than people leaving the labor force.

Year over year, employment rose by 99k, or 0.5%, led by a 131k increase in full-time positions. Wage growth also improved, with average hourly earnings up 3.3% from a year earlier, after a 3.0% rise in May.

Action Forex said the report is unlikely to alter the Bank of Canada’s policy outlook, but it does weaken the case for markets to price a more dovish stance ahead of the central bank’s next week meeting, given ongoing uncertainty tied to Canada’s trade outlook.

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