WRAPUP 1-Canada's economy cools in Q3, Nov hiring surge keeps pressure on cenbank


OTTAWA, Dec 1 (Reuters) - The Canadian economy slowed in the third quarter after a hot first half of the year as exports tumbled, but an acceleration in hiring and wage growth last month was seen giving the central bank reason to raise interest rates again before long.

The economy added 79,500 jobs in November, Statistics Canada said on Friday, blowing past expectations for a gain of 10,000 and sending the unemployment rate to 5.9 percent, its lowest since February 2008 even as labor market participation was unchanged.

"This was another barn-burner of a jobs report," said Sal Guatieri, senior economist at BMO Capital Markets.

"For the Bank of Canada, this certainly means the economy is doing quite well and pumping out a lot of jobs," which could make the central bank's statement after its meeting next week more upbeat, Guatieri said.

The Canadian dollar rose against the greenback. . While the bank is largely expected to hold rates steady on Dec. 6, odds of a hike as soon as January rose to 57.2 percent following the data.

"It certainly firms the idea that there are more near-term hikes than previously anticipated," said Michael Dolega, senior economist at Toronto-Dominion Bank.

Average hourly wages also continued to accelerate, up 2.7 percent from last year in the best performance since April 2016. The Bank of Canada, which raised interest rates twice earlier this year, has pointed to wages as one factor it is looking at to decide future policy.

The Canadian labor market has been on a tear for over a year and has added 390,000 jobs since last November, driven by full-time employment.

Manufacturing saw the biggest increase in the goods-producing sector last month, adding 30,400 jobs, while in the services sector, the wholesale and retail trade industry created 38,800 jobs.

The jobs figures garnered more attention from economists than the separate gross domestic product report, which showed the economy grew at an annualized 1.7 percent in the third quarter.

Canada's economy had been expected to slow after growth in the first half of the year that made the country a leader among its industrialized peers.

Exports were the main drag on the economy in the third quarter as shipments of vehicles and parts fell amid work stoppages and changes to certain models sent to the U.S. market.

(Additional reporting by Alastair Sharp and Nichola Saminather in Toronto; Editing by Susan Thomas)