Canadian Labour Congress

Canadian Labour Congress

June 10, 2008 14:46 ET

Canadian Labour Congress: Disappointment With the Bank of Canada

OTTAWA, ONTARIO--(Marketwire - June 10, 2008) - The Canadian Labour Congress today expressed its disappointment that the Bank of Canada left its target for the overnight rate at 3%. Many economists had expected, with reason, a quarter point interest rate cut today, in addition to the last half point cut announced on April 22nd.

"The country needs the stimulus that a cut in the rate would have provided and the Bank of Canada failed to provide it," says Ken Georgetti, president of the Canadian Labour Congress.

Core inflation is running at 1.5%, well below the Bank of Canada's 2% target.

"Canada's job market has clearly weakened over the past two months because of the high Canadian dollar and its effect on the manufacturing and forestry sectors. Jobs are getting very hard to find for those entering the labour force and for those who are losing their current jobs".

The labour force data for the past two months - not available when the Bank of Canada last set interest rates - show that we have lost 12,000 full-time jobs since March, and that the number of unemployed workers has risen by 18,000.

Adds Georgetti: "Most disturbingly, people who want to work are having a hard time: the youth unemployment rate has jumped from 11.0% to 11.9%."

Recent data shows that Canada's economy shrunk by 0.1% in the first quarter, indicating that we may well have entered a recession. Economic growth was even weaker than in the US. Moreover there are clear signs of a further weakening of exports and of the housing market.

The Canadian Labour Congress, the national voice of the labour movement, represents 3.2 million Canadian workers. The CLC brings together Canada's national and international unions along with the provincial and territorial federations of labour and 130 district labour councils. Web site: www.canadianlabour.ca.

Contact Information

  • Canadian Labour Congress
    Jean Wolff
    Communications
    613-526-7431 and 613-878-6040
    or
    Canadian Labour Congress
    Andrew Jackson
    Senior Economist
    613-526-7445 and 613-240-3869