The lack of private sector investment and reluctance of the Bank of Canada to make any major monetary policy moves is having a drag effect on the Canadian economy. Inflation in Canada is relatively high comparative to income growth and hence there is a lack of stimulus driving true, sustainable economic growth. Canadians are seeing erosion of their purchasing power, however, there are some signs of labour market growth and an increase in confidence of both consumers and businesses.
Trading Event: Canadian Employment Change @ 12:30 GMT
- Last month the unemployment rate increased 7.1% from 7% in May, with labour market growth the slowest in 4 years.
- It is expected that 24,500 new jobs will be added to the Canadian economy and the employment rate is predicted to fall back to the 7% level.
- Canadian Ivey Purchasing Manger’s Index regained four previous month’s losses, returning to April’s level of 54.1.
- Providing a more detailed report of both public and private sector opinion; the employment component of the index showed a modest gain.
- Banc De Binary analysts predict employment in Canada will increase marginally, indicating a potential downward movement in USD/CAD.