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Analysts at TD Securities suggest that the Canadian labour market has turned heads with its remarkable performance over the last twelve months, adding 470k jobs over that period, but TD is looking for a more modest performance with the creation of 5k jobs in September which is well below the current 6m trend of 30k.

Key Quotes

“Our forecast assumes mean reversion following last month’s 81k increase which stands as the second highest since 2012, trailing only the 106k print from April. Details should prove more downbeat with a pullback in private employment and the unemployment rate projected to drift higher to 5.8% following last month’s surge in labour force participation which helped to hold the unemployment rate unchanged.”

“Wage growth should be the one bright spot, with average hourly earnings forecast to hold at 3.8% y/y as recent gains have helped sap even more slack from the labour market.”