BoC’s future rate hikes gets support by latest jobs data

While the employment growth in February was not as significant as in January, it was still somewhat more than expected, which is another sign that the Canadian economy will start 2023 with more strength than previously predicted.

The increase in jobs this month was less pronounced than in prior months, but the overall trend is still higher than would be anticipated given the rate of GDP growth. Since the economy is still stagnating as a result of earlier interest rate rises, analysts continue to forecast some lower employment numbers for the rest of this year as well as a gradual rise in the unemployment rate.

Although analysts continue to doubt that the statistics will be convincing enough for decision-makers to act once more, the Bank of Canada will continue to tilt towards future rate increases as long as the jobless rate remains historically low and wage growth is solid.