263,000 jobs were created in the United States last month, and the unemployment rate remained unchanged – suggesting that the labour market remains too tight for the Federal Reserve’s liking. According to data released by the Bureau of Labor Statistics this morning, the unemployment rate held at 3.7 percent in November, and the participation rate moved down to 62.1 percent from 62.3 in the prior month, indicating that fewer workers are coming off the sidelines. Average hourly earnings rose 0.6 percent month-over-month, accelerating from the pace set in October.

Ahead of the release, investors were positioned for a 200,000-job gain, with the unemployment rate seen holding at 3.7 percent.

The dollar climbed on the print as Treasury yields leapt by more than 10 basis points across the curve. Stock futures plunged as investors braced for a longer tightening cycle from the Federal Reserve.

Canada generated 10,100 jobs in November, matching expectations for a 10,000-position increase – but below the hood, the details looked even more favourable, with 50,700 full-time positions added as 40,600 part-time roles were shed. According to data released by the national statistics agency this morning, the unemployment rate fell to 5.1 percent from 5.2 percent in October. Average hourly wages climbed 5.4 percent on a year-over-year basis, holding flat with the pace recorded in the prior month.

The data will help reinforce still-modest odds on a jumbo-sized 50 basis point move at the Bank of Canada’s next meeting, but markets are convinced an economic downturn is coming, and the loonie remains under pressure as longer term interest differentials stay stubbornly negative.