U.S. Key Rate: Ready for Liftoff in September
Dennis Lockhart, President and CEO of the Federal Reserve Bank of Atlanta, was bang on last week with his positive comments regarding the U.S. economy, as 211,000 jobs were created in July, bringing 2015’s total so far to 1.5 million.
The divergence with Canada’s job market is evident. At first blush, Canada employment numbers for July seemed healthy, with 7,000 jobs created. However, the private sector unfortunately recorded a significant loss of 28,000 jobs, and 41,000 positions were created in the self-employed category. Alberta and Saskatchewan continued to bleed jobs, whereas employment in Quebec rose strongly (+22,000).
The Canadian economic indicators that will capture our attention this week will be Manufacturing Shipments for June released on Friday. We are forecasting a rise of 3.4%, a figure that is much higher than the consensus established at 2.4%. This indicator will be a good barometer of June’s GDP to determine the scope of a potential technical recession. In the U.S., we will be monitoring Retail Sales on Thursday, which will give us a good idea of the economic recovery underway. Lastly, on Friday the release of the Producer Price Index for July will provide us with insight into inflationary pressures.
