Slowing Wage Growth to Keep Bank of Canada on Hold

Dow Jones
Aug 10

1139 ET - Canada's surprising labor-market strength of late is accompanied by slowing wage growth. That latter factor is going to keep the Bank of Canada firmly on hold, says David Rosenberg, head of market-strategy firm Rosenberg Research. July employment data surprised with a 75,100 net gain and a drop in the unemployment rate to 6.4%. Rosenberg notes that average hourly wages for permanent workers decelerated from a year ago to 3% in July, from a comparable 3.7% reading in the prior month. He says that's the weakest rise in labor costs in over 4 years. "There is no smoking gun here for the BOC to shift back to a hawkish stance," Rosenberg says.

 

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