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The economy shed a net 17,300 jobs in May, entirely in full-time work, while the jobless rate inched up to 5.2%, Statistics Canada said. Analysts surveyed by Reuters had forecast a net gain of 23,200 jobs and for the unemployment rate to edge up to 5.1% in May after staying at 5.0% since December. A series of surprisingly strong economic data and stubbornly high inflation led the Bank of Canada to raise its overnight rate to a 22-year high of 4.75% on Wednesday. "While this is an ugly set of jobs data, the labour force survey is notoriously volatile," said Royce Mendes, head of macro strategy at Desjardins Group. Reports on jobs, inflation and gross domestic product are due out ahead of the next policy announcement on July 12.

Persons: Andrew Grantham, Paul Beaudry, Beaudry, Royce Mendes, Ismail Shakil, Steve Scherer, Fergal Smith, Dale Smith, Susan Fenton, Nick Macfie, Jonathan Oatis Organizations: OTTAWA, Statistics, Reuters, Bank of Canada, Bank of, CIBC Capital Markets, Desjardins Group, Canadian, Thomson Locations: Canada, Statistics Canada, Bank of Canada, Ottawa, Toronto

☆ Bank of Canada hiked rates over alarm at household spending, stubborn inflation
▼ + stars: | 2023-06-08 | by ( ) www.reuters.com time to read: +3 min

By Steve Scherer and David LjunggrenOTTAWA, June 8 (Reuters) - Surprisingly strong household spending in the first quarter and stubbornly high core inflation were among the top reasons the Bank of Canada hiked rates after a four-month pause, a senior official said on Thursday. The Bank of Canada (BoC) on Wednesday hiked its overnight rate to a 22-year high of 4.75%, and markets and analysts forecast yet another increase next month after the policy announcement declared monetary policy was not sufficiently restrictive. Speaking to business executives in Vancouver in the BoC's first remarks since raising rates, Beaudry singled out unexpectedly strong household spending, a rebound in the housing market, a tight labor market, and sticky core inflation as the main factors behind the latest move. Core inflation measures "seem to have lost their downward momentum", he said. There is a greater risk of higher rates in the future, so "it's important to think ahead", Beaudry said, and "be better prepared in the eventuality that we have entered a new era of structurally higher interest rates".

Persons: Steve Scherer, David Ljunggren OTTAWA, Paul Beaudry, Beaudry, David Ljunggren Organizations: Bank of Canada, Wednesday, BoC, Reuters, Thomson Locations: Vancouver, Reuters Ottawa

OTTAWA, June 7 (Reuters) - The Bank of Canada on Wednesday hiked its overnight rate to a 22-year high of 4.75%, and markets and analysts immediately forecast yet another increase next month to ratchet down an overheating economy and stubbornly high inflation. Noting an uptick in inflation in April and the fact that three-month measures of core inflation remained high, the Bank of Canada (BoC) said that "concerns have increased that CPI inflation could get stuck materially above the 2% target." However, Canada Finance Minister Chrystia Freeland said the economic rebound from the COVID-19 pandemic and Russia's invasion of Ukraine has been stoking price increases. "To bring demand lower, which is the bank's goal to achieve their 2% inflation target, we just simply need more tightening." The BoC said it would continue to assess economic indicators going forward to see if they "are consistent with achieving the inflation target."

Persons: Derek Holt, Paul Beaudry, Canada's, Pierre Poilievre, Justin Trudeau, Chrystia Freeland, Andrew Kelvin, Steve Scherer, David Ljunggren, Fergal Smith, Divya Rajagopal, Nivedita Balu, Mark Porter Organizations: OTTAWA, Bank of Canada, Wednesday, Canadian, Scotiabank, BoC, Conservative Party, Liberal, Canada Finance, TD Securities, Thomson Locations: British Columbia, Ukraine, Canada, Toronto

OTTAWA, Feb 21 (Reuters) - Canada's annual inflation rate eased more than expected in January to 5.9%, data showed on Tuesday, which should allow the Bank of Canada to stay on the sidelines at its next meeting while it lets previous rate hikes sink in. Before the inflation figures were released, money markets saw a 100% chance for another rate increase this year. The bank forecasts inflation to slow to about 3% by the middle of 2023, and to come down to its 2% target next year. Excluding food and energy, January prices rose 4.9% compared with a 5.3% increase in December. The figures show prices coming down faster in Canada than in the United States, where annual inflation gained 6.4% in January.

OTTAWA, Feb 16 (Reuters) - Bank of Canada Governor Tiff Macklem said on Thursday that the economy remains overheated and the jobs market is too tight, as he kept the door open to future interest rate hikes. On Jan. 25, the Bank hiked its key interest rate to 4.5%, the highest level in 15 years, and became the first major central bank to say it would hold off on further increases as long as prices eased as forecast. "The Canadian economy remains overheated and clearly in excess demand and this continues to put upward pressure on many domestic prices," Macklem said. "The tightness in the labor market needs to ease, wage growth needs to moderate and service price inflation needs to cool" or else more interest rate hikes will be needed, he added. At its last policy meeting, the Fed lifted its benchmark overnight interest rate by a quarter of a percentage point to the 4.50% to 4.75% range.

OTTAWA, Sept 20 (Reuters) - Inflation in Canada remains "too high" but is headed in the right direction, a Bank of Canada official said on Tuesday, adding that the central bank will do whatever is needed to bring price increases back to target. While we're headed in the right direction, that's still too high," Beaudry said in prepared remarks provided ahead of the speech. While some have argued policymakers need to engineer a recession to avoid this, Beaudry said the bank is working to convince Canadians the current period of high inflation is temporary and it will tame surging prices. Still, economists said if consumer and business surveys due out next month show inflation has become more entrenched, the Bank of Canada may have to change its tune. The Bank of Canada has boosted its policy rate by 300-basis points in six months and earlier this month signaled it was not yet done.

☆ Bank of Canada: inflation is still too high, but moving in the right direction
▼ + stars: | 2022-09-20 | by ( ) www.reuters.com time to read: +1 min

OTTAWA, Sept 20 (Reuters) - The Bank of Canada on Tuesday said inflation remained "too high" even as data showed price pressures were easing off peak levels, and pledged to continue to do whatever was needed to bring it back to target. While we're headed in the right direction, that's still too high," Beaudry said in prepared remarks provided ahead of the speech. Inflation slowed again in August, though at 7.0% it remains well above target. The three core measures of inflation, which taken together are seen as a better indicator of underlying price pressures, also eased slightly. (Reporting by Julie Gordon, editing by David Ljunggren)((Reuters Ottawa bureau, + 1 647 480 7921; david.ljunggren@tr.com))Register now for FREE unlimited access to Reuters.com RegisterOur Standards: The Thomson Reuters Trust Principles.

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