Jobs Day Looms as Yields Slide

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Jobs Day Looms as Yields Slide

49.60 S&P Global Manufacturing5,350m Trade Balance5,350m Trade Balance

S&P/TSX35,605.30-2.03%

USD/CAD1.41+0.64%

EUR/CAD1.57+0.12%

WTI Crude90.96+0.49%

Market Snapshot

Asset	Level	Change
S&P/TSX	35,605.30	-2.03%
USD/CAD	1.41	+0.64%
EUR/CAD	1.57	+0.12%
WTI Crude	90.96	+0.49%
Natural Gas	3.01	+1.97%
Gold	4,079.00	-0.84%
Brent Crude	98.51	+0.22%
Bitcoin	76,023.60	+0.11%
Canada 2Y Govt Yield	3.22%	-4 bp
Canada 10Y Govt Yield	3.70%	-7 bp

Prior Economic Events

Data	Prior	Cons	Actual
S&P Global Manufacturing PMI Index	51.50	-	49.60
Trade Balance	4,950m	4,100m	5,350m
Trade Balance	4,950m	4,100m	5,350m

Today's Economic Events

Data	Prior	Cons	Time
Headline Unemployment Rate	6.50	6.50	08:30
Employment Change	-68,300	13,600	08:30
Full-Time Employment Change	-35,400	-	08:30
Labor Force Participation	64.80	-	08:30
Part-Time Employment Change	-32,900	-	08:30
Ivey PMI Seasonally Adjusted	58.20	58	10:00

Canada releases the November labour force survey at 08:30 ET; consensus sees unemployment steady at 6.5% and a modest 13.6k employment rebound after October's 68.3k decline.
Ivey PMI follows at 10:00 ET, with consensus at 58.0 versus 58.2 prior.
GoC yields fell yesterday (2Y -4 bp to 3.22%, 10Y -7 bp to 3.70%) while the TSX dropped 2.03% and USD/CAD climbed 0.64% to 1.41.

Yesterday's Recap

Canadian markets were risk-off on November 5, with the S&P/TSX falling 2.03% to 35,605.30 as global growth concerns and easing oil prices weighed on sentiment. The loonie weakened, with USD/CAD rising 0.64% to 1.41 and EUR/CAD up 0.12% to 1.57. Government of Canada bonds rallied: the 2-year yield eased 4 bp to 3.22% and the 10-year fell 7 bp to 3.70%, a curve move consistent with softer growth expectations rather than inflation fears.

On the data front, Canada's merchandise trade surplus widened to CAD 5.35 billion in the November 4 release, well above the CAD 4.10 billion consensus and the prior CAD 4.95 billion, reflecting strong energy export values. The S&P Global Manufacturing PMI printed at 49.6 on November 2, slipping from 51.5 into contraction territory — a warning that tariff-related demand softness is bleeding into factory activity. Energy was a relative bright spot, with WTI up 0.49% to $90.96 and natural gas up 1.97% to $3.01, while gold fell 0.84% to $4,079.

The Day Ahead

All eyes are on Statistics Canada's November labour force survey at 08:30 ET, the week's highest-impact domestic print. Consensus expects the unemployment rate to hold at 6.5% and employment to rebound by 13.6k after October's steep 68.3k contraction; full-time and part-time splits, plus the participation rate (prior 64.8), will matter for the quality of any headline beat. A soft print would reinforce the bond rally and pressure the loonie toward further weakness, while a strong rebound could steady CAD and steepen the curve.

At 10:00 ET, the seasonally adjusted Ivey PMI is due, with consensus at 58.0 versus 58.2 prior — a read on whether purchasing activity is holding up despite the manufacturing PMI's slide below 50. No major Government of Canada auctions or BoC events are scheduled, leaving data to drive positioning into the weekend.

Other Economic Notes

The divergence between a still-solid trade surplus and a manufacturing PMI in contraction is a key tension for the Canadian outlook, with energy export values propping up nominal trade while tariff uncertainty erodes factory orders. CPI at 3.09% year-over-year remains above target, keeping the BoC cautious even as growth indicators soften. ↓ p.2

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Other Economic Notes (continued)

The federal budget unveiled this week leans on higher oil revenue for tax incentives and infrastructure spending, a mildly stimulative tilt that could complicate disinflation later. Housing and consumer credit data remain the swing factors for the domestic demand picture into year-end.

Global Macro News

Global markets are fretting over growth and inflation simultaneously despite easing oil prices, with post-US midterm election dynamics reshaping the outlook. Oil prices were set for a sharp weekly drop after Republican midterm losses raised hopes of de-escalation in the US-Israel-Iran conflict, a move that feeds directly into Canadian energy revenues and the CAD. Gold hit a two-week high as the dollar and Treasury yields fell after the midterms, while a weaker dollar and lower oil prices drove further Indian rupee gains.

Regional warfare continues to hit Gulf economies — Emirates Group profit dropped 66% as Iran-war disruption and high oil prices weighed on Dubai's airline. For Canada, the combination of softer global growth signals and a weaker US dollar backdrop argues for continued GoC bond strength and CAD vulnerability.

BoC Watch

The Bank of Canada's policy rate stands at 2.50%, set at the October 28 decision, with the next meeting on December 9. This week's renewal of the monetary policy framework kept the 2% inflation target intact, with the government and BoC issuing a joint statement confirming continuity — removing a tail risk that markets had quietly monitored. ↓ p.3

Continuation

BoC Watch (continued)

Governor Macklem is appearing before a Senate committee to discuss economic conditions, and the BoC has outlined a risk-based approach to monetary policy, language that suggests the Governing Council is weighing tariff shocks and growth downside against sticky 3.09% CPI. The committee voted to hold at 2.50%, and markets should read the December meeting as live but data-dependent: today's labour survey and the trajectory of inflation will determine whether easing resumes. Quantitative tightening continues to run down the balance sheet, keeping upward pressure on term premiums even as front-end yields fall.

For positioning, the BoC's risk-based framing supports a steeper curve bias and CAD downside if growth data disappoint.

Canada Macro Daily(Beta Mode)