Event of the Week – Non-Farm Payrolls (USD, GMT 12:30) – A 200k June nonfarm payroll increase is anticipated, after gains of 339k in May, 294k in April, and 217k in March. We have divergent risk from a rise in initial claims but a fall in continuing claims into June. The jobless rate is expected to hold steady at 3.7% from May, versus a 54-year low for the two-digit rate of 3.43% in January. Hours-worked are assumed to rise 0.1% after a -0.1% May drop, while the workweek holds steady at 34.3. Average hourly earnings are assumed to rise 0.3%, after a 0.3% gain in May, while the y/y wage gain should be steady from 4.3%. The ensuing strength in wage gains has allowed continued robust y/y increases, though the return of low-paid workers to the workforce is likely restraining wage increases.
Employment Change & Unemployment Rate(CAD, GMT 12:30) – Canada reported a -17.3k drop in employment in May after climbing 41.4k in April. This was the first decline since last August’s -24.8k slump and was much weaker than expected. Concurrently, the unemployment rate rose to 5.2% from 5.0%, while the hourly wage rate of permanent employees dipped to 5.1% from 5.2%. These data justify the lack of forward guidance in the BoC’s policy.
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