{"id":76837,"date":"2026-08-07T18:09:17","date_gmt":"2026-08-07T18:09:17","guid":{"rendered":"https:\/\/www.pantheregroup.com\/2026\/08\/07\/blockbuster-jobs-growth-unlikely-to-push-bank-of-canada-off-sidelines\/"},"modified":"2026-08-07T18:09:17","modified_gmt":"2026-08-07T18:09:17","slug":"blockbuster-jobs-growth-unlikely-to-push-bank-of-canada-off-sidelines","status":"publish","type":"post","link":"https:\/\/www.pantheregroup.com\/2026\/08\/07\/blockbuster-jobs-growth-unlikely-to-push-bank-of-canada-off-sidelines\/","title":{"rendered":"Blockbuster jobs growth unlikely to push Bank of Canada off sidelines"},"content":{"rendered":"<p> \n<br \/><iframe loading=\"lazy\" title=\"Bank of Canada would cut rates if not for Iran war\" width=\"1080\" height=\"608\" src=\"https:\/\/www.youtube.com\/embed\/dcDYKAfsXJA?feature=oembed\" frameborder=\"0\" allow=\"accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share\" referrerpolicy=\"strict-origin-when-cross-origin\" allowfullscreen><\/iframe><\/p>\n<p> Canada\u2019s unemployment rate fell to a two-year low of 6.4 per cent in July as the economy added 75,000 jobs across a wide range of industries, Statistics Canada said Friday. <\/p>\n<p> Here\u2019s what economists had to say about the latest jobs numbers and what they could mean for the Bank of Canada\u2019s future interest rate decisions. <\/p>\n<h2>\u2018Clear signs of recovery\u2019: TD Economics<\/h2>\n<p> Beyond the job gains, July\u2019s lower unemployment rate was \u201cencouraging,\u201d given that hiring outpaced the \u201csizeable\u201d 61,000 gain in the labour force, said Andrew Hencic, director and senior economist at TD Economics. <\/p>\n<p> \u201cThis shows the economy was able to absorb more labour market slack in July,\u201d Hencic said in a note. \u201cWhen coupled with the strong bounce-back in activity in the second quarter, some additional momentum on jobs in July is nice to see.\u201d <\/p>\n<p> Hencic said the labour market is showing \u201cclear signs of recovery,\u201d but the country\u2019s 6.4 per cent unemployment rate \u201ccontinues to signal an economy operating with some slack.\u201d <\/p>\n<p> \u201cTogether with the prospect of new tariffs coming into effect on August 19th, the downside risks to the economy remain,\u201d he said. \u201cWe continue to expect the unemployment rate to gradually decline in the coming months as the economy deals with the volatility in energy prices and potentially more trade headwinds.\u201d <\/p>\n<p> Against this backdrop, TD Economics expects the Bank of Canada to hold its benchmark interest rate at 2.25 per cent for the rest of the year. <\/p>\n<h2>Gains \u2018much stronger\u2019 than expected: Capital Economics<\/h2>\n<p> July\u2019s job gains were \u201cmuch stronger\u201d than the 15,000 economists had expected, Capital Economics Ltd. senior North America economist Ariane Curtis said in a note. <\/p>\n<p> \u201cThere was really nothing in the report to dislike, with the strength in employment reflecting a rise in both full-time and part-time employment and driven entirely by the private sector and to a lesser extent self-employment, while the number of public sector employees fell,\u201d she said. <\/p>\n<p> Average hourly wages were up 2.8 per cent year-over-year in July but down from 3.3 per cent in June, which Curtis said will provide some \u201ccomfort\u201d to the Bank of Canada that the recent employment gains haven\u2019t contributed to stronger wage pressures yet. <\/p>\n<p> \u201cWhile the Bank of Canada is likely to sound more hawkish following the fall in the unemployment rate, they are unlikely to rush into tightening policy given the ongoing softness of wage growth core inflation,\u201d she said. \u201cIndeed, for now we are sticking to our view that the Bank will remain on hold this year.\u201d <\/p>\n<h2>\u2018Lots of sizzle and steak\u2019: KPMG Canada<\/h2>\n<p> KPMG Canada chief economist Ali Jaffery said in a note that after holding back due to worries about trade, businesses are \u201cgetting on with it\u201d and starting to hire again. <\/p>\n<p> \u201cThese job gains are not being driven by new entrants, because population and labour force growth remain relatively soft,\u201d he said. \u201cRather, they reflect unemployed workers finding jobs. The number of unemployed people has declined for three consecutive months, for a cumulative decrease of 112,000.\u201d <\/p>\n<p> Jaffery said the Bank of Canada shouldn\u2019t be \u201ctoo worried\u201d about remaining slack in the economy, as \u201ca soft housing market and subdued wage growth\u201d are keeping inflation pressures muted. <\/p>\n<p> \u201cThat combined with rising global long-rates and Canada\u2019s long-run growth rate being dented from trade tensions and lower immigration will give the Bank the bias to support Canada\u2019s recovery for as long as it can,\u201d Jaffery said. \u201cWe expect the BoC will stay on hold for the remainder of this year and at least into the start of next year.\u201d <\/p>\n<h2>Job market \u2018looks a little brighter\u2019: Indeed<\/h2>\n<p> Laura Ulrich, director of economic research at Indeed, said it\u2019s worth noting that StatCan\u2019s July jobs report showed improving trends in youth employment. <\/p>\n<p> Unemployment among youth ages 15 to 24 years old was 12.6 per cent in July, virtually unchanged from June but down 1.9 percentage points from a year ago. Ulrich said the summer job market is an important part of the story. <\/p>\n<ul class=\"related_links\">\n<li>Canada&#8217;s economy gains 75,000 new jobs, driving down unemployment rate<\/li>\n<li>U.S. employers unexpectedly shed jobs as unemployment rate falls<\/li>\n<\/ul>\n<p> \u201cReturning students posted a 15.1 per cent unemployment rate, down more than two points compared to last summer, and for those aged 20 to 24, the rate fell to 6.3 per cent, its lowest for any July since 2018,\u201d Ulrich said in a note. \u201cFor younger Canadians, the labour market looks a little brighter in 2026.\u201d <\/p>\n<p> Ulrich said that while July\u2019s report is \u201coverwhelmingly positive,\u201d the overall trend still looks \u201ca lot more like stabilization from last year\u2019s softness rather than true acceleration.\u201d <\/p>\n<p> \u201cBut three straight months moving in the right direction is exactly how turning points begin \u2014 and if the breadth we saw in July holds into the fall, stabilization could quietly become the momentum Canada has been waiting for,\u201d Ulrich said. <\/p>\n<p> <em>\u2022 Email: jswitzer@postmedia.com<\/em> <\/p>\n\n<br \/>Blockbuster jobs growth unlikely to push Bank of Canada off sidelines<\/a><br \/>\n<br \/>2026-08-07 18:09:17<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Canada\u2019s unemployment rate fell to a two-year low of 6.4 per cent in July as the economy added 75,000 jobs across a wide range of industries, Statistics Canada said Friday&#8230;.<\/p>\n","protected":false},"author":2,"featured_media":76838,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[31],"tags":[],"class_list":["post-76837","post","type-post","status-publish","format-standard","has-post-thumbnail","category-economy"],"_links":{"self":[{"href":"https:\/\/www.pantheregroup.com\/api\/wp\/v2\/posts\/76837","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.pantheregroup.com\/api\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.pantheregroup.com\/api\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.pantheregroup.com\/api\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.pantheregroup.com\/api\/wp\/v2\/comments?post=76837"}],"version-history":[{"count":0,"href":"https:\/\/www.pantheregroup.com\/api\/wp\/v2\/posts\/76837\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.pantheregroup.com\/api\/wp\/v2\/media\/76838"}],"wp:attachment":[{"href":"https:\/\/www.pantheregroup.com\/api\/wp\/v2\/media?parent=76837"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.pantheregroup.com\/api\/wp\/v2\/categories?post=76837"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.pantheregroup.com\/api\/wp\/v2\/tags?post=76837"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}