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10 May 2024

Loonie Jumps on Jobs Beat

The Canadian economy generated more jobs than anticipated in April, helping reduce market expectations for an imminent pivot toward easier monetary policy from the Bank of Canada. 90,000 new positions were added in the month and the unemployment rate held at 6.1 percent in March. Consensus estimates had pointed to 20,000 new hires, with elevated population growth and still-high participation rates pushing unemployment to 6.2 percent. The services sector generated most of the gains, but gains were widespread, with professional, scientific and technical services, accommodation and food, health care and social assistance, and natural resources industries offsetting modest losses in...

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US Exceptionalism Fades, Weighing On Greenback

The “US exceptionalism” trade took another blow yesterday morning when the Bureau of Labor Statistics said the number of Americans filing initial applications for unemployment benefits rose last week to an eight-month high. The jump in jobless claims – up 22,000 to a seasonally-adjusted 231,000 in the week ended May 4 – surprised economists and helped bolster expectations for rate cuts from the Federal Reserve, helping erode the dollar’s yield premium and lift other currencies in relative terms. Softness in the labour market dovetails with our belief that re-acceleration hopes for the economy have become overblown, and we think that...

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