OTTAWA, Canada – Canada added 37,000 jobs in January, pushing down the unemployment rate 0.1 percentage points to 5.7 percent, the national statistical agency said Friday.
The unexpected employment gains were driven by an increase in part-time work, according to Statistics Canada.
The drop in the unemployment rate, meanwhile, was the first observed since December 2022. It had been moving upward through most of 2023, rising from 5.1 percent last April to 5.8 percent in December.
“The employment data suggests that June is now more likely for the first Bank of Canada rate cut of this cycle than April,” Desjardins analyst Royce Mendes reacted in a research note.
He and others adjusted downward by 25 basis points their predictions that interest rates would be cut, bit by bit, to end the year at 3.75 percent.
The bank has held its key lending rate at 5 percent in recent months after aggressively hiking it in a bid to tame soaring inflation from a record low of 0.25 percent in March 2022.
“Today’s data suggest that the bank won’t be in a rush to cut interest rates,” said CIBC Economic’s Andrew Grantham, echoing expectations for a first cut in June.
Statistics Canada said the job gains were spread across several industries in the services-producing sector, led by a turnaround in wholesale and retail trade, as well as finance, insurance, real estate, rental and leasing.
There were also increases in educational services, transportation and warehousing, business, building and other support services, and public administration.
The gains were partially offset by declines in accommodation and food services, professional, scientific and technical services, and information, culture and recreation. — Agence France-Presse
