Economists are once again calling for the Bank of Canada to raise interest rates by 25 basis points at its meeting scheduled on September 4.

The rate decision will be the highlight of this week’s market data. With most businesses closed Monday for the Labour Day holiday, the rate decision is pushed back to Wednesday rather than a typical Tuesday announcement. TD Bank sees a 25 bps rate hike in the cards.

“The market has shifted a number of times in recent weeks on its view of the Bank’s decision this week,” admits BMO Nesbitt Burns. “While still viewed as a close call, the market is leaning towards yet another 25 basis point rate hike next Wednesday. Given the still-fragile state of global financial markets, the prudent course of action for the Bank of Canada may be to keep rates unchanged next week, but the odds seem to favour a rate hike.”

“An as-expected rate hike announcement (up 25 bps) will as usual be followed by a message justifying the need for a tightening. For some reason, the market tends to be surprised by the hawkish tone in such statements, so look for the front end of the yield curve to come under selling pressure and the Canadian dollar to get a lift as the market, if only temporarily, prices in further hikes ahead,” suggests CIBC World Markets.

Following the rate decision, the help-wanted index and building permit numbers are out on Thursday. And, the jobs report comes Friday. “Employment figures top Statistics Canada1s calendar, with odds favoring a downward move in the unemployment rate if the participation rate eases off from recent strong gains,” notes CIBC.

BMO says that employment likely rose by a moderate 15,000 positions in the month, compared with a gain of 23,000 in July and an average monthly increase of 46,700 so far this year. “Still, even a 15,000 increase would equal 0.1% of the workforce, representing a larger gain than seen at anytime in the past two years in U.S. payrolls. It would also be large enough to hold the jobless rate steady at 7.6%.”

In the U.S., the ISM manufacturing index is out on Tuesday. Thursday brings the ISM non-manufacturing index, factory orders and non-farm productivity. The U.S. jobs report is also out on Friday. CIBC says that the risks are towards a rising unemployment rate in August.

BMO says that the ISM manufacturing index, which will likely show that production rebounded slightly in August, but continues to expand at a moderate pace. It also says that the highlight of next week will be jobs data. “With the U.S. recovery just a touch above stall speed and corporate profits remaining elusive, firms remain very reluctant to add staff. Accordingly, non-farm payrolls for August are expected to expand by a modest 30,000. The slippage in the labour market will be reflected in the jobless rate, which is expected to nudge back up to April’s cyclical peak of 6%.”

The only earnings releases scheduled for this week are Alimentation Couche-Tard, due on Thursday, and Canadian Western Bank, which is scheduled to report on Friday.