January 10, 2020 / 2:22 PM / 12 days ago

Canada gains 35,200 jobs in December, jobless rate falls to 5.6%

TORONTO (Reuters) - Canada’s economy gained a net 35,200 jobs in December, entirely in full-time work, Statistics Canada said on Friday. The jobless rate fell to 5.6%.

Stories:

Market reaction: CAD/

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JOSH NYE, SENIOR ECONOMIST AT RBC

“Good employment report, we were all hoping for a bit of a rebound after pretty ugly jobs figures in November. The head count bounced back about 35k increase, not fully retracing the decline that we saw in November but certainly a decent bound. I think the more important thing was that the unemployment rate fell back down to 5.6%.

“Governor Poloz said yesterday he’d be keeping an eye on incoming employment reports to see whether that moderation in November - we also saw a bit of a decline in October - wanted to see whether that would persist, I think he’ll be pleased to see that rebound in jobs numbers in December. I don’t think that means a rate cut from the Bank of Canada is necessarily off the table for the first half of the year. The latest GDP figures that we’ve seen have been a little disappointing. It looks like the economy geared down a bit in the second half of 2019. Unless we see that really turning around in Q4 and early this year as well, I think the Bank of Canada’s going to continue to evaluate whether the economy needs a bit more stimulus.”

BENJAMIN REITZES, CANADIAN RATES & MACRO STRATEGIST AT BMO CAPITAL MARKETS

“I think the fact that we didn’t get a negative should be a relief after back to back declines and the real story here I think is not to expect the type of job gains in 2020 that we saw through the first part of 2019.”

“I think they (Bank of Canada) will be relieved they didn’t get another negative. There would be much more concern if you got three consecutive negative prints on the headline.”

ANDREW KELVIN, CHIEF CANADA STRATEGIST AT TD SECURITIES

“It’s a decent rebound. Obviously November was a very poor month for the employment figures. We were never going to make up that (about) 71,000 decline we saw the previous month.”

“If you look at the composition it was also healthy with it being entirely full time jobs. And I wouldn’t worry too much about the deceleration in average hourly earnings, it’s still very healthy at 3.4%.”

“So it’s a pretty decent print and it should put some of the immediate fears around the Canadian economy, not to rest but certainly make them a little bit less intense.”

Reporting by Fergal Smith, Allison Martell and Moira Warburton; Editing by Denny Thomas

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