Canada's Job Market Surprises with Remarkable Growth in June

Canada's unemployment rate slightly decreased to 6.9% in June, with notable job growth in sectors like wholesale trade, retail, and healthcare. More than 83,000 jobs were added, surprising analysts. Inflation data and U.S. tariffs influence expectations for the Bank of Canada's next monetary policy decision on July 30.

In an unexpected turn, Canada's unemployment rate saw a slight decrease to 6.9% in June, buoyed by unforeseen job growth in sectors such as wholesale trade, retail, and healthcare, according to data released on Friday. A total of 83,100 new jobs marked the first net job increase since January, as reported by Statistics Canada, primarily driven by part-time employment.

Analysts had earlier forecasted a rise in the unemployment rate to 7.1%, with no job additions. This surprise increase in jobs and drop in unemployment is likely to influence the Bank of Canada's upcoming monetary policy decision on July 30. The robust figures appear to reduce the probability of a rate cut, as market betting on such a move has fallen below 20% following the labor report.

The Canadian dollar reflected these economic shifts, trading down slightly at 1.3671 to the U.S. dollar. While the layoff rate remained low at 0.5%, the number of long-term unemployed increased significantly. Overall, employment in wholesale and retail rose markedly, while the transportation sector saw declines, highlighting tensions in tariff-exposed industries.

(With inputs from agencies.)