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Solid Canada job gains in June set stage for next move by Poloz

Construction of an office tower in downtown Toronto is seen in this file photo.

Fred Lum/The Globe and Mail

Canada's unemployment rate is down to 6.5 per cent after the economy churned out a better-than-expected 45,000 jobs in June.

Most of those gains, however, were in part-time positions.

Still, over the course of 12 months, Canada has created 351,000 jobs, most of them full-time.

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Read more: Financial markets are banking on a July 12 rate hike from BoC

And notably, Statistics Canada said Friday, employment gains in the second quarter, of 103,000, mark the strongest quarterly showing since 2010.

The jobless rate dipped one notch, from 6.6 per cent in May.

Quebec and British Columbia led the way June, the latter pumping out 20,000 new jobs as unemployment declined by a hefty half of a percentage point to 5.1 per cent.

By sector, professional, scientific and technical services led the charge.

The Canadian dollar shot up after the Statistics Canada report, buoyed by mounting speculation that Bank of Canada Governor Stephen Poloz and his colleagues will raise their benchmark rate as early as next week.

"We had held on to our October forecast for a Bank of Canada rate hike, but concede that's likely to end up off the mark, as today's jobs numbers cement the case for the central bankers to raise rates in the coming week," said CIBC World Markets chief economist Avery Shenfeld.

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"June's job gains were widely spread across goods and services, split evenly between paid jobs and self-employment, with the only disappointment being a leaning to part-time jobs, although full-time jobs are still up a heady 1.7 per cent in the past year," he added.

"In sum, the jobs market is tightening, and not far from what historically has been judged as full employment. Over to you, Governor Poloz."

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