Gains in the construction, manufacturing, and agriculture sectors fueled an additional 34,500 jobs in Canada, according to Statistics Canada

Unemployment dropped to 5.5 percent in January 2020, from December’s 5.6 percent. On average, economists predicted an increase of 15,000 for the month, as reported by Refinitiv, a financial markets data firm. Doug Porter, Bank of Montreal chief economist said, “While the Bank of Canada is clearly on high alert over the potential economic implications of the new coronavirus, recent indicators suggest the economy had decent underlying momentum at the start of the year”.

The Bank of Canada put its key interest rate target on hold at 1.75 percent but is eyeing future rate cuts if any weakness is experienced in the economy. Porter said if weakness starts due to the coronavirus, he thinks the Bank of Canada will move, but the newest job numbers give comfort for the time being. Average hourly wages in the first month of the year were up 4.2 percent from last year. He said the job report is consistent in showing there is some wage pressures building, which is typical with a low unemployment rate of 5.5 percent.