Kevin Carmichael: Latest 'robust' job numbers raise odds Bank of Canada will hike again via financialpost
“Job gains in Canada have been surprisingly strong in recent months,” Rogers said in a speech in Winnipeg hosted by the Manitoba Chambers of Commerce. “With weak economic growth for the next couple of quarters, however, we expect that the tightness in the labour market will ease and, as it does, pressure on wages will come down.”in the fourth quarter. That indicator fits with what the Bank of Canada is trying to do. Macklem raised the benchmark interest rate to 4.5 per cent from 0.
Some commentators assumed a recession was inevitable. But Canadian employers keep hiring, and it’s apparently a sellers’ market because wages are rising at a pace that hasn’t been seen in decades.
Statistics Canada said average hourly wages increased 5.4 per cent from February 2021, representing a re-acceleration of wage growth that had been tracking lower.Article content Rogers explicitly stated in her speech that wage increases at an annual rate of four per cent to five per cent is faster than Canada’s economy can handle because productivity is too weak to match supply to the demand that will come when incomes are increasing that fast. All things equal, the latest hiring numbers increase the odds that the Bank of Canada will have to resume increasing interest rates after pausing on March 8.
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