Canadian employment saw a decline of 88k jobs in January

Posted: Friday, February 9, 2018 - 09:01 EST

Canadian employment finally gave jobs back after a strong run of 17 straight months of positive additions.  Canadian employment saw a decline of 88k jobs in January that fell well below expectations of +10k.  Within the details, part time employment contributed to all the jobs losses, declining -137k, while full-time added +49k.  The participation rate declined by 0.3% to 65.5% which alleviated pressures on the unemployment rate increasing from 5.7% to 5.9%.  Average hourly wages in January increased positively by 3.3% driven by increases in minimum wage in Ontario.  Today’s employment data could put the Bank of Canada on the sidelines for the upcoming March rate decision, as the Bank pledged to be data dependent on the path of interest rates moving forward.

The U.S. Congress was able to pass the budget bill early morning that will end the government shutdown that lasted since midnight.  The deal will see funding extend to March 23 with the debt ceiling suspended until March 2019 while Congress debates how funding will be spent.  In the Canadian corporate credit market, volatility remained similar to global equity markets.  As North American equities moved lower to end the day, flows reversed towards selling with spreads moving wider.  The tone this morning remains weaker.

Equity Markets:

 

  Index Level % Change QTD YTD Q3 2016 Q4 2016 Q1 2017 Q2 2017 Q3 2017 Q4 2017
S&P 500 2,581.00 -3.75% -3.31% -3.31% 3.85% 3.82% 6.07% 3.09% 4.48% 6.64%
TSX

15,065.61

-1.73% -6.87%

-6.87%

5.45% 4.53% 2.41% -1.64% 3.68% 4.44%

Rates:

 

Today

% Change

QTD change

YTD change

Sept 30 2016

Dec 31 2016

Mar 31 2016

June 30 2017

Sept 30  2017

Dec 31  2017

Canada 5 Year

2.098%

-0.03% 0.23% 0.23% 0.615% 1.150% 1.119% 1.393% 1.753% 1.866%
Canada 10 Year 2.357% -0.02% 0.31% 0.31% 0.990% 1.750% 1.625% 1.762% 2.099% 2.045%
Canada 30 Year 2.499% 0.02% 0.23% 0.23% 1.658% 2.350% 2.302% 2.148% 2.472% 2.266%
30yr Generic Corporate A rated Spread 1.210% 0.00% 0.00% 0.00% 1.530% 1.390% 1.330% 1.210% 1.240% 1.210%
30yr All-in Corporate A rated Yield

3.709%

0.02% 0.23% 0.23% 3.188% 3.740% 3.632% 3.358% 3.712% 3.476%
US 10 Year 2.844% 0.02% 0.44% 0.44% 1.60% 2.50% 2.39% 2.31% 2.33% 2.41%
CDX IG 60.764 1.103                

The information contained herein is intended for advisors for general information only and is compiled from sources believed to be reliable, but no representation or warranty, express or implied, is made as to its accuracy. All opinions contained in the commentary and expressed by the portfolio manager are subject to change without notice and are provided in good faith without legal responsibility. All market data is sourced from Bloomberg.