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Canada July employment change -2.8K vs +22.5K expected

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  • Previous month -1.4k
  • Employment change -2.8K vs. +22.5K expected
  • Unemployment rate 6.4% vs. 6.4% expected (up 0.9% y/y)
  • Employment rate in the previous month 6.4%
  • Full-time employment +62.0K vs. -3.4K previously
  • Part-time work -64.4 thousand vs. +1.9 thousand previously
  • Participation rate 65.0% vs. 65.3% previously
  • Average hourly earnings on an annual basis increased 5.2% compared to 5.4% last month.

These are consecutive negative figures, although their impact has been somewhat mitigated by the increase in full-time jobs. However, the unemployment rate would have risen significantly had it not been for the sharp decline in participation.

The USD/CAD pair has been volatile in the aftermath, but I see this as a clear sign of a slowdown. Combined with the latest Fed spending tracker, it becomes clear that the Canadian economy is heading for a downturn.

Key changes by industry:

  • Wholesale and retail trade: -44,000 (-1.5%)
  • Finance, Insurance, Real Estate, Rental & Leasing: -15,000 (-1.0%)
  • General Administration: +20,000 (+1.6%)
  • Transport and storage: +15,000 (+1.4%)
  • Facilities: +6,200 (+4.2%)

Here’s the surprise:

  • Public sector +41 thousand
  • Private sector -42 thousand

On an annual basis:

  • Public sector +205 thousand
  • Private sector +86 thousand

This article was written by Adam Bouton on www.forexlive.com.

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