Yet another strong jobs report will put the Bank of Canada back in its rate hiking shoes, according to economists. Canadian payrolls jumped more 66,000 in June, pushing the jobless rate down two ticks to 7.5%.

June’s employment growth was almost entirely in full-time work, with 60,000 new jobs. Since the labour market rebound began in January, employment has increased 303,000 (+2%).

“It was another stunning month in the Canadian labour market,” says BMO Nesbitt Burns, noting that the result was more than triple the anticipated gain of 20,000, “as job growth has smashed expectations in each month this year”. Almost all of the positions created last month were full-time, across a broad range of industries, BMO notes.

“This morning’s Canadian employment report for June was enough to leave even the most diehard of optimists utterly speechless,” says TD Bank. “Not only did the Canadian economy pump out another 66,400 jobs during the month, but it did so on the back of a total gain of 237,000 positions in the first five months of the year — leaving the six-month gain in employment running at its fastest pace (in percentage terms) since early 1988.”

Hours worked tell a similarly robust story, says CIBC World Markets, with surging labour input pointing to a near 5% real GDP gain for the second quarter.

“Diverging employment fortunes have been reason enough for the Bank of Canada to go-it-alone on interest rates, and the latest hiring binge cements another Bank rate hike come July 16th,” says CIBC. “Beyond that, the risks engendered by recent equity market jitters suggest the Bank could tread lightly on the rate front.”

TD agrees that rates are going higher. “With not even a hint emerging in this morning’s employment report that the Canadian economy may be cooling down from the red-hot pace recorded in the first half of the year, and with core inflation running slightly above the 2% threshold, this morning’s data will certainly leave hearts thumping loudly at the Bank of Canada,” it says. “A 25 basis-point rate hike at the July 16 fixed announcement date is now a no-brainer, and a total of 125 basis points by the end of the year remains in the cards.”

BMO agrees, saying, “This report should quash any doubts about the Bank of Canada hiking rates by 25 basis points on July 16.”