Canada loses 39.4K jobs in July compared to a 10K jobs gain expected
- Unemployment rate ticks to 7.2% from 7.1%
- No change in the unemployment rate was expected
- Prior job losses were 0.4K (Canada never revises prior jobs numbers)
- Full-time jobs -18.3K
- Part-time jobs -21.2K
- Participation rate 66.5% vs 66.7% prior
- First back-to-back months of jobs losses since late 2011
This report is even worse than it looks. If not for the drop in the participation rate, unemployment would have risen to 7.4%. The BOC’s optimism on the economy is beginning to look misplaced.
Canadian jobs added or lost w 4-month moving avg
The loonie is got smashed in the face initially, rising to 1.0343 but it’s stabilizing at the moment. In the big picture, the 4-month moving average of Canadian jobs shows a decent picture but that could change in a hurry if next month is weak.
There are some medium-sized options running off today at 1.0370 and 1.0375 so they could help pull USD/CAD further from here.
