07:06 AM EDT, 08/12/2024 (MT Newswires) -- The Canadian Labour Force Survey (LFS) for July, released on Friday, once again underlined why the Bank of Canada (BoC) has now cut interest rates for the second time, said Commerzbank.

Instead of the moderate job growth that economists had been expecting, investors saw job losses -- albeit very small ones -- for the second month in a row, wrote the bank in a note to clients.

No comparison with previous months, when the labor market appeared somewhat more robust, stated Commerzbank. The unemployment rate only stopped rising because the participation rate surprisingly fell -- which is also not a good sign for the Canadian labor market.

With figures like these, it should be easy for the BoC to cut rates further in the coming months, pointed out the bank. It was already clear from the minutes of the last meeting that policymakers are concerned that the labor market is cooling too much.

As such, there is a strong case to be made that the BoC will make its next cut in September -- at least as long as next week's inflation figures don't show an unexpected rise, added Commerzbank.

As a result, the Canadian dollar (CAD or loonie) is likely to remain under pressure, according to the bank.