Canadian Job Growth Slows, Will BoC Cut Rates?

Canadian employers added 8,400 jobs in the month of May, it’s lowest of 2008. The slowdown was due to the service producing sector losing 20,200 jobs, signaling that domestic demand may be waning as the growth prospects for the country continue to diminish. Pessimistic companies traded 32,200 fulltime workers for 40,600 part-timers, as they try and reduce fix costs heading into a tough environment. The lack of commitment from employers underlies the weakness of the economy which unexpectedly shrank 0.2% in the first quarter. A commodity boom has led to double digit gains in jobs over the past four months. However, headwinds from the U.S. slowdown continue to impact its neighbor to the north which has led to speculation that BoC governor Carney will cut rates again at tits policy meeting next week. – John Rivera, Currency Analyst