Canada Jobs Soar in July, Unemployment Rate Hits Two-Year Low

Canada's economy added a significant number of jobs in July, exceeding expectations. According to Statistics Canada, employment jumped by 75,100 positions, driven by strong gains in both full-time and part-time sectors. The jobless rate dropped for the third consecutive month, falling from 6.5% to 6.4%, a level last seen in July 2024.

The private sector saw significant growth, with strength in wholesale and retail trade, finance and insurance, and professional and scientific services. Analysts polled by Reuters had forecast a net gain of 16,500 positions and estimated the jobless rate would remain at 6.5%. However, some experts cautioned that while the data shows the economy is coping with US tariffs and international tensions, it's not yet back to full health.

Arline Curtis, senior North American economist at Capital Economics, stated that this is further evidence that the economy is gaining momentum after a weak start to the year. The Bank of Canada has kept interest rates at 2.25% since last October and money markets do not expect a hike until next year.

The Canadian dollar strengthened by 0.4% to a near eight-week high of C$1.3959 to the US dollar, or 71.64 US cents. The average hourly wages of permanent employees grew 3.0% in July, down from 3.7% in June.