Data released on Thursday, showed that employment in Canada plunged 1.01 million in March. Analysts at RBC Capital Markets forecast the unemployment rate will average 14% during the second quarter.
Key Quotes:
“The 1 million drop in jobs in March reported this morning makes every other month-over-month change in the labour force survey data before look like a rounding error. The largest prior one-month declining dating back to 1976 was a 125 thousand decline. The job losses in one month were more than twice the total job losses in the 2008/09 global financial crisis. But the April decline could already be multiples of this March drop, given another almost 3 million people have reportedly applied for employment-loss benefits since the mid-March labour force survey reference period.”
“Our latest forecasts assume that the unemployment rate will average 14 ½% in the second quarter, double March’s 7.8% rate. That might be too high given the smaller-than-assumed increase in March, but only if a large share of layoffs continue to be non-temporary, and if workers drop out of the labour market rather than being technically counted as unemployed. The key to gauging the pace at which the economy can bounce back from the current downturn still depends on the extent to which employer-employee relationships can be maintained, and households and businesses can bridge the gap until current social distancing policies can be eased.”
“An unprecedented labour market shock is also being met by an unprecedented increase in government support for households and businesses – both in Canada and abroad. (...) These programs could distort some labour market statistics in the near-term, but provide important offsets to households to get through a period of unprecedented economic weakness.”
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD fluctuates in daily range above 1.0600
EUR/USD struggles to gather directional momentum and continues to fluctuate above 1.0600 on Tuesday. The modest improvement seen in risk mood limits the US Dollar's gains as investors await Fed Chairman Jerome Powell's speech.
GBP/USD stabilizes near 1.2450 ahead of Powell speech
GBP/USD holds steady at around 1.2450 after recovering from the multi-month low it touched near 1.2400 in the European morning. The USD struggles to gather strength after disappointing housing data. Market focus shifts to Fed Chairman Powell's appearance.
Gold retreats to $2,370 as US yields push higher
Gold stages a correction on Tuesday and fluctuates in negative territory near $2,370 following Monday's upsurge. The benchmark 10-year US Treasury bond yield continues to push higher above 4.6% and makes it difficult for XAU/USD to gain traction.
XRP struggles below $0.50 resistance as SEC vs. Ripple lawsuit likely to enter final pretrial conference
XRP is struggling with resistance at $0.50 as Ripple and the US Securities and Exchange Commission (SEC) are gearing up for the final pretrial conference on Tuesday at a New York court.
US outperformance continues
The economic divergence between the US and the rest of the world has become increasingly pronounced. The latest US inflation prints highlight that underlying inflation pressures seemingly remain stickier than in most other parts of the world.