Markets are anticipating a fairly stable report when Statistics Canada releases its Labour Force Survey on Friday. While the Net Change in Employment is predicted to rise by 10K in June, adding to the 87.8K gain in May, the Unemployment Rate is forecast to stay at 6.6%.

Despite the report’s tone, the Bank of Canada (BoC) should keep the bar pretty high for changing its policy direction. Indeed, the central bank is expected to keep its policy unchanged at its July 15 meeting, following five consecutive ‘on hold’ decisions since it last lowered rates in October 2025.

The June meeting reinforced the view that the BoC is firmly in wait-and-see mode. That said, policymakers seem willing to look through temporary shocks as long as underlying price pressures remain contained, even as they continue to monitor inflation risks, especially from higher energy prices. With the economy still showing signs of slack, the bank sees little need to change course for now. Moreover, future policy decisions will remain data-dependent, with the bar for another rate hike still appearing relatively high.

So far, market participants expect nearly 15 basis points of tightening from the BoC by year-end, down from around 35 basis points a month ago.

What can we expect from the next Canadian jobs report?

Consensus among analysts sees Canada’s Unemployment Rate at 6.6% last month. Additionally, investors forecast the economy will add around 10K jobs in June. It is worth recalling that Average Hourly Wages rose at an annualised 3.2% in May, suggesting some cooling in wage inflation.

When is the Canadian unemployment rate released, and how could it affect USD/CAD?

In Canada, traders will closely watch Friday’s jobs report, due at 12:30 GMT. A stronger print could give the Canadian Dollar (CAD) a quick lift, but don’t expect fireworks.

USD/CAD has been trading in a consolidative mood since late June, always close to its yearly peaks near 1.4250.

Pablo Piovano, Senior Analyst at FXStreet, points out that further gains in USD/CAD now appear limited by the 1.4250 zone, forcing spot to recede a tad and revisit the mid-1.4100s once again.

“In case the selling pressure gathers traction, the pair’s next relevant support is expected at the provisional 55-day SMA near 1.3900, while the loss of this region exposes a move toward the critical 200-day SMA near 1.3850, all preceding the interim 100-day SMA near 1.3820. A deeper and sustained retracement from here should see the next contention at the May floor at 1.3549 (May 1),” Piovano adds.

On the upside, Piovano sees the next hurdle at the YTD peak of 1.4248 (June 24 and 25). The break above the latter could prompt the pair to attempt a move toward the April 2025 ceiling at 1.4414 (April 1).

“Momentum favours extra gains,” he adds, noting that the Relative Strength Index (RSI) is hovering around 63 and the Average Directional Index (ADX), just over 52, suggests the underlying trend remains pretty solid.

Economic Indicator

Participation Rate

The Participation Rate is the percentage of the total number of people of working age (15 years and over) that is in the labor force (either working or looking for a job). The data provided by Statistics Canada is monthly and seasonally adjusted; this eliminates the impact of seasonal variations and makes it possible to compare data throughout the year.

Read more.

Last release:
Fri Jun 05, 2026 12:30

Frequency:
Monthly

Actual:
65%

Consensus:
65.1%

Previous:
65%

Source:

Statistics Canada

Canadian Dollar FAQs

The key factors driving the Canadian Dollar (CAD) are the level of interest rates set by the Bank of Canada (BoC), the price of Oil, Canada’s largest export, the health of its economy, inflation and the Trade Balance, which is the difference between the value of Canada’s exports versus its imports. Other factors include market sentiment – whether investors are taking on more risky assets (risk-on) or seeking safe-havens (risk-off) – with risk-on being CAD-positive. As its largest trading partner, the health of the US economy is also a key factor influencing the Canadian Dollar.

The Bank of Canada (BoC) has a significant influence on the Canadian Dollar by setting the level of interest rates that banks can lend to one another. This influences the level of interest rates for everyone. The main goal of the BoC is to maintain inflation at 1-3% by adjusting interest rates up or down. Relatively higher interest rates tend to be positive for the CAD. The Bank of Canada can also use quantitative easing and tightening to influence credit conditions, with the former CAD-negative and the latter CAD-positive.

The price of Oil is a key factor impacting the value of the Canadian Dollar. Petroleum is Canada’s biggest export, so Oil price tends to have an immediate impact on the CAD value. Generally, if Oil price rises CAD also goes up, as aggregate demand for the currency increases. The opposite is the case if the price of Oil falls. Higher Oil prices also tend to result in a greater likelihood of a positive Trade Balance, which is also supportive of the CAD.

While inflation had always traditionally been thought of as a negative factor for a currency since it lowers the value of money, the opposite has actually been the case in modern times with the relaxation of cross-border capital controls. Higher inflation tends to lead central banks to put up interest rates which attracts more capital inflows from global investors seeking a lucrative place to keep their money. This increases demand for the local currency, which in Canada’s case is the Canadian Dollar.

Macroeconomic data releases gauge the health of the economy and can have an impact on the Canadian Dollar. Indicators such as GDP, Manufacturing and Services PMIs, employment, and consumer sentiment surveys can all influence the direction of the CAD. A strong economy is good for the Canadian Dollar. Not only does it attract more foreign investment but it may encourage the Bank of Canada to put up interest rates, leading to a stronger currency. If economic data is weak, however, the CAD is likely to fall.