Fengye Bank: Canadian unemployment rate is not expected to hinder the central bank's policy decisions.

Derek Holt of the Bank of Commerce expressed that the shrinking population and labor force in Canada are expected to lower the country's unemployment rate, which contradicts some more lax perspectives. These perspectives believe that the continuously rising unemployment rate may hinder the policy response of the Bank of Canada to a significant inflation shock that is forming. This economist stated that the lag in population data from Statistics Canada's labor force survey will lead to downward revisions in future data, thus the unemployment rate may fall to 6% or even lower. Holt said that some individuals with more lax views are discussing the unemployment rate rising to 7%, but he believes that given the unemployment rate has already reached 6.7%, Bank of Canada Governor Macklem will not pay attention to this forecast, even if the unemployment rate is not more likely to decrease.