Toronto, Jan 11, 2026, 15:11 EST — The market has closed.
- Shares of Royal Bank of Canada rose 0.2% in Toronto, while the U.S.-listed version dipped 0.2%
- Canada’s unemployment rate climbed to 6.8% in December, fueling ongoing speculation about future rate moves
- Traders are eyeing two key dates: the U.S. Supreme Court rulings on Jan. 14 and the Bank of Canada meeting on Jan. 28
Shares of Royal Bank of Canada (RY.TO) finished Friday at C$235.52, edging up 0.2%. Across the border in New York, RBC’s stock (RY) slipped 0.2% to close at $169.19, ahead of Monday’s trading session. (FinancialContent)
RBC shares remain closely tied to moves in interest rates. Shifts in bond yields and central bank policies typically drive bank stocks, since they affect lenders’ margins between loan earnings and deposit costs.
Canada added 8,200 jobs in December, but the unemployment rate ticked up to 6.8% as more people entered the labor force, Statistics Canada reported. Economists had forecast a slight decline in jobs. Andrew Grantham, senior economist at CIBC Capital Markets, noted there’s still “plenty of slack” in the labor market. Meanwhile, Royce Mendes, head of macro strategy at Desjardins, said the figures aren’t weak enough to alter Bank of Canada policy expectations. (Reuters)
RBC economist Claire Fan echoed this view, describing the labour market recovery as “underway but will likely prove choppy.” She added that the report backs the central bank’s “near-term holding bias.” Fan expects the Bank of Canada to keep rates steady throughout this year, with hikes coming in 2027. (RBC)
Risk appetite held steady heading into the weekend. Canada’s main stock index climbed 0.7% on Friday, closing at a fresh record high. Investors absorbed the latest jobs figures while watching trade policy developments closely. “With everything going on, unemployment is up somewhat but the economy is OK,” said Lorne Steinberg, president of Lorne Steinberg Wealth Management. (Reuters)
Currency and oil moved the needle as well. The Canadian dollar dropped 0.3% on Friday, marking its steepest weekly decline in nearly 11 months. The 10-year government bond yield retreated, while oil closed at $59.12 a barrel, according to Reuters. George Davis, chief technical strategist at RBC Capital Markets, noted that developments in Venezuela have been pressuring the loonie and might create longer-term challenges for Canada’s heavy oil export markets. (Reuters)
For RBC, a weaker loonie has its ups and downs. It boosts the translated value of U.S. earnings, but it might also signal a sluggish domestic economy or rising funding stress. On top of that, lower bond yields can squeeze net interest margin — the gap between what the bank earns on loans and what it pays on deposits.
Trade uncertainty continues to weigh on Canadian assets. The U.S. Supreme Court plans to release its next batch of rulings on Jan. 14, including decisions that could affect President Donald Trump’s broad tariffs. However, the court hasn’t disclosed which cases will be addressed. (Reuters)
Canada’s key date for rate-sensitive stocks is the Bank of Canada’s Jan. 28 announcement, accompanied by its Monetary Policy Report. (Bank of Canada)
RBC posted a solid fourth quarter in early December, exceeding profit estimates thanks to robust capital markets. It also upgraded its return on equity target for fiscal 2026. During that quarter, the bank put aside C$1 billion in provisions for credit losses, according to a Reuters report.
The road ahead isn’t smooth. Should hiring slow more and unemployment climb, credit losses could emerge after a delay. Yields falling faster would also pinch margins, even if loan demand stays steady. On top of that, a sudden shift in trade policy would deal a fresh blow to business confidence.
RBC traders eye Monday and the coming week closely, tracking if bond yields and the Canadian dollar continue their drift after the jobs report. They’ll also watch to see if the tariff case lands on the Supreme Court’s agenda for Jan. 14, ahead of the Bank of Canada’s big moment on Jan. 28.
