Canada: Focus on employment and trade data – RBC CM

According to the analysts at RBC Capital Markets, focus of investors in today’s session will be on the release of Canadian employment and international trade data.

Key Quotes

“Employment: We expect a 15K decline in employment in December, partially retracing four consecutive months of increases (average of 37K per month), which look overstated and have been have been tilted toward part-time jobs. The services sector has accounted for the bulk of the job gains and should see a 20K decline in the month, while a small bump in manufacturing employment (+5K) should be the highlight on the goods-side. Combined with no change in the size of the labour force, the 15K decline should see the unemployment rate tick up to 6.9% after declining two-tenths in November.”

“Int’l Merchandise Trade: We see a slight deterioration in the November trade balance to -C$1.4bn from -C$1.1bn in October. A 1.6% rise in imports off a multi-year low should be tempered by a 1.0% gain in exports. Real non-energy goods exports were tracking at -0.8% y/y in October and have a much tougher comparable this time around as they rose 3.4% m/m in November 2015, meaning that a continued negative YoY rate (has been for four of the past five months) is likely. We caution that this release can be subject to significant back revisions.”