Rates had risen several basis points this morning thanks to stronger than expected April jobs reports on either side of the border but have given much of that back.

In Canada, 58,000 jobs were added [exp. 20k], representing a step in the right direction following a very disappointing March print. That most of the additions were of the part-time variety does not seem to be a great concern. Additionally, these new jobs helped bring the reported unemployment rate down to 7.6% from 7.7%.

The US also added jobs in April: 244k [exp. 185k]. Given the recent run of disappointing jobs data, markets will be somewhat relieved with this strong headline number. Despite the positive jobs growth, the unemployment rate actually increased from 8.8% to 9.0%. Confusingly, the reported jobs number is based on a survey a companies, while the unemployment rate is based on a survey of households. So while the survey of companies (the “Establishment Survey”) reported 244k new jobs for April, the reported loss of 190k jobs in the Household Survey was responsible for driving the unemployment rate higher.

Strong employment reports tend to cause selloffs in the bond market as robust economies lead rates higher. Outside of today’s positive reports, most recent data had been disappointing, and it appears that the bond market hasn’t been able to shake that caution altogether.

Generally weak data was released in North America this morning. For Canada, Manufacturing Sales growth of -0.8% in November fell well short of the +0.3% reading the market had been expecting. The slide was caused entirely by a decrease in the motor vehicles / parts segment.

For the US, Housing Starts for December at 529k annualized were also weak, but there was a strong pickup in building permits, and some weak results released by some US financial institutions this morning are also weighing on the market.

Balancing off these generally disappointing items are strong earnings results in the tech sector and decent results in the latest auction of Portuguese debt.

Rates have been fairly flat over the past several trading days as the limited data released has largely been in line with market expectations.

Unsurprisingly this morning, the Bank of Canada held the overnight rate steady at 1.0%, citing elevated risks in the global recovery as reason for caution.

Looking ahead to the rest of the week:

US: Housing Starts / Building Permits (Wed); Existing Home Sales, Leading Indicators, Philly Fed (Thu)

Canada: Manufacturing Shipments (Wed); Leading Indicators, Wholesale Trade (Thu); Retail Sales (Fri)