The Financial reports in its Friday, Feb. 1, edition that on Thursday Bank of Canada senior deputy governor Carolyn Wilkins said stubbornly low wage growth in Canada should start picking up later this year as the economy overcomes a slowdown caused by weak oil prices and housing market softness.
A Reuters dispatch to the Post reports that the BOC has long fretted over the anemic growth in compensation despite a tight labour market. The national average year-over-year wage growth of permanent employees remained at 1.5 per cent in December, the lowest since the 1.2 per cent recorded in July, 2017.
Ms. Wilkins said: "We expect the economic expansion to pick up again in the second quarter of 2019. This should lead to a pickup in wage growth as well."
The bank, she added, would do its part to meet inflation objectives but made no mention of the need for further rate hikes. The bank stayed on the sidelines on Jan. 9 and market traders expect it to hold rates steady once again on March 6.
However, despite the unemployment rate hitting 40-year-lows, Mr. Wilkins said it would be "too hasty" to conclude that the country's job market was at a point where inflation pressures were starting to build.
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