Canadian employment falls for a second straight month as jobless rate edges up
Canada’s economy shed 68,000 jobs in September, well short of the 10,000 gain expected and following a 42,000 decline in August, for roughly 110,000 jobs lost over the past two months. The unemployment rate edged up to 6.5% from 6.4%. Losses were concentrated in the public sector, led by education and health care, though the weakness was broad-based across age groups, with youth employment down 48,000. Hourly wages rose 2.3% year over year, up from 2.0% in August.
Why this matters: Back-to-back declines undercut the pickup in hiring seen earlier in the year and add to concerns that escalating trade tensions with the U.S. may be weighing on business sentiment and hiring. Following the release, markets scaled back expectations for near-term Bank of Canada (BoC) tightening, with bond yields and the Canadian dollar moving lower.
U.S. trade deficit widens on record imports as services growth continues
The U.S. goods and services trade deficit widened to US$105.6 billion in August from a revised US$92.8 billion in July, as imports climbed 4.3% to a record US$420.8 billion, outpacing a 1.4% rise in exports. The larger goods deficit reflected strong demand for capital goods and consumer products. Separately, U.S. services activity continued to grow in September, with the Institute for Supply Management (ISM) non-manufacturing Purchasing Managers’ Index (PMI) easing slightly to 54.9 from 55.4. New orders pointed to continued growth in business demand, and the employment index returned to expansion territory after two months of contraction.
Why this matters: Record imports alongside solid services demand point to firm domestic demand, though the survey’s prices index climbed to its highest level since July 2022 as businesses reported higher fuel and transportation costs and ongoing supply-chain strains. Longer supplier delivery times also suggest strong demand continues to stretch capacity, which may keep inflation pressures in focus.
| Index† | Change (%) | Index Level | |||
|---|---|---|---|---|---|
| Week | MTD | YTD | 1 Yr | ||
| Treasury Bill | 0.04 | 0.07 | 1.73 | 2.29 | 194 |
| Canadian Bonds | 0.64 | 0.87 | 0.08 | 0.01 | 1,201 |
| Canadian Equities | 0.52 | 1.28 | 14.45 | 20.58 | 35,665 |
| U.S. Equities | 1.17 | 2.13 | 15.12 | 17.33 | 7,812 |
| International Equities | -0.53 | -1.49 | 9.26 | 13.58 | 3,079 |
| Emerging Market Equities | 0.04 | 0.27 | 23.85 | 26.95 | 1,709 |
| European Equities | 0.09 | -0.35 | 9.88 | 14.07 | 211 |
| Currencies† | Change (%) | Exchange rate | |||
|---|---|---|---|---|---|
| Week | MTD | YTD | 1 Yr | ||
| C$/US | -0.04 | -0.19 | -3.73 | -1.67 | 0.70 |
| C$/Euro | 0.42 | 0.98 | 0.93 | 1.54 | 0.63 |
| C$/Pound | 0.02 | 0.08 | -1.98 | -1.12 | 0.53 |
| Commodities (US$)† | Change (%) | Price | |||
|---|---|---|---|---|---|
| Week | MTD | YTD | 1 Yr | ||
| WTI Crude Oil ($/Barrel) | 0.81 | 1.58 | 61.37 | 51.72 | 92 |
| Gold ($/oz) | 1.30 | 0.71 | -6.25 | 1.67 | 4,216 |
Treasury Bill is represented by the FTSE Canada 60 Day T-Bill Index (C$), Canadian Bonds represented by the FTSE Canada Universe Bond Index (C$), Canadian Equities represented by the S&P/TSX Composite TR Index (C$), U.S. Equities represented by the S&P 500 TR Index (US$), International Equities represented by the MSCI EAFE GR Index (US$), Emerging Market Equities represented by the MSCI EM GR Index (US$), European Equities represented by the MSCI Europe Index (€). It is not possible to invest directly in an index. Assumes reinvestment of all income and no transaction costs or taxes.
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