U.S Job Growth Slows while Canada Job Numbers Explode

US Job Growth Slows in December
  • The U.S economy added +148k in December, almost all of them in the private sector (Previous +239k vs. +193k e).
  • The U.S service sector deeply hit.
  • Well below the 2017 monthly average of +171k jobs added but is enough to keep up with population growth and chip away at unemployment.
  • The labor-force participation didn’t budge in 2017 despite the +2m  jobs added. Participation rate stands at +62.7% in December.
  • The average hourly paycheck for private sector workers grew +2.5% in 2017. That suggests the labor market still has some slack despite the low unemployment.
  • Hourly wages grew +9c , or +0.34%, in December from a month earlier.
  • U.S yield curve 2/10 see a ‘bull’ flatter being priced in at +49 bps
Market reaction sell the USD (€1.2059, £1.3564, ¥113.34) and buy U.S treasuries.
Canadian Job Numbers explode
  • Canada’s unemployment rate dropped to a four-decade low in December and job creation exceeded expectations for a second consecutive month.
  • The Canadian economy added a net +78.6k jobs in December vs. market expectations of +2k.
  • Canada’s jobless rate records a new low of +5.7%, down from 5.9% m/m – the lowest unemployment rate in four decades. Expectations were looking for the jobless rate to tick up to +6%.
  • 2017 was the best year for Canadian job growth since 2002.
  • Full time employment change: +23.7K vs +29.6K prior – Part time employment change: +54.9K vs. +49.9K prior
  • Participation rate: 65.8% v 65.7% prior

This morning’s strong data would likely increasing pressure on the Bank of Canada (BoC) to hike interest rates much sooner than the market has being calculating. Odd’s for a Jan hike next week are currently trading at +50%.

​The CAD is up +0.88% at C$1.2369​

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Dean Popplewell

Dean Popplewell

Vice-President of Market Analysis at MarketPulse
Dean Popplewell has nearly two decades of experience trading currencies and fixed income instruments. He has a deep understanding of market fundamentals and the impact of global events on capital markets. He is respected among professional traders for his skilled analysis and career history as global head of trading for firms such as Scotia Capital and BMO Nesbitt Burns. Since joining OANDA in 2006, Dean has played an instrumental role in driving awareness of the forex market as an emerging asset class for retail investors, as well as providing expert counsel to a number of internal teams on how to best serve clients and industry stakeholders.
Dean Popplewell