'The underlying picture for Canada's labor market is softening,' said Doug Porter, chief economist at BMO Capital Markets. The Bank of Canada (BoC) held rates at a 22-year-high of 5.0% last month after having raised them 10 times between March of last year and July to try to bring inflation back to its 2% target. The softer-than-anticipated jobs report follows data out earlier this week indicating that the economy likely slipped into a shallow recession in the third quarter.
'While that's still inconsistent with the Bank of Canada’s 2% inflation target, monetary policymakers will take the deceleration as a sign that their medicine is working,' he said. 'In line with the more pronounced cooling in hiring, the annual pace of wage growth for permanent employees slowed three ticks to 5.0%,' said Royce Mendes, head of macro strategy at Desjardins. The average hourly wage for permanent employees - a figure closely watched by the central bank - rose 5.0% from a year earlier, down from the 5.3% in September. Analysts polled by Reuters had forecast a net gain of 22,500 jobs and for the unemployment rate to tick up to 5.6% from 5.5% in September.
Canada added a net 17,500 jobs in October, Statistics Canada data showed.
