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Bank of Canada’s interest rate freeze shows the job market is on fire

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The most interesting thing about the Bank of Canada deciding to do nothing with its key interest rate on Wednesday was its observation about the job market.

Earlier this month, Statistics Canada said the Canadian economy was a job-creation machine in overdrive, producing 106,500 new positions in April — the biggest one-month increase in decades. Wages were up too. And the job gains for the year have surpassed 426,000 — the best performance in 12 years.

Essentially, Canada's job market looked like it was just too good to be true, especially since growth in the broader economy had slowed to a barely discernible crawl at the end of last year and the beginning of this year.

But the Bank of Canada has had a close look and thinks it's for real.

On Wednesday, the central bank announced it would leave its key interest rate unchanged and gave no indication it was ready to move either up or down any time soon. But that doesn't mean there's nothing going on beneath the surface. Rather, the bank said it saw some reasons to be encouraged about the domestic economy, but also some key risks looming on the horizon, especially at a global level.

On the job market, the bank said employers had sensed that the winter weakness in the Canadian........

© St. Catharines Standard