Canada Sheds 68,300 Jobs in September While US Consumer Sentiment Hits Near-Record Low

Canada's economy lost 68,300 jobs in September, far worse than the forecast for a gain of roughly 9,200 to 10,000, marking a second consecutive month of falling employment. Statistics Canada reported that full-time employment fell by 35,400 and part-time by 32,900, with the services sector alone shedding 52,300 jobs. The losses were large enough to wipe out all employment gains made in Canada so far in 2026, according to reporting from Investing.com, with the ongoing trade war with the United States cited as a key drag on the labor market.

The unemployment rate rose to 6.5%, in line with forecasts but up from 6.4% in August, while the participation rate slipped to 64.8% against an expected 65.0%. Average hourly wages for permanent employees accelerated to 2.3% year-over-year from 2.0% previously, complicating the inflation picture for the Bank of Canada. Swap markets responded swiftly: odds of a Bank of Canada rate hike at its October meeting fell to 27% from 40% following the report.

Separately, US consumer sentiment deteriorated further in October. The University of Michigan's preliminary headline index fell to 46.3 from 48.1 in September, missing the consensus forecast of around 47.5 to 47.8 and marking the second-lowest reading on record. The current conditions component was the hardest hit, dropping 6.2 points to 44.7, the lowest level ever recorded. One-year inflation expectations rose to 4.7% from 4.6%, while the longer-run 5-10 year expectation ticked up to 3.5% from 3.4%, both readings signaling persistent inflation anxiety among American consumers. The expectations component bucked the trend, coming in at 47.3, above the 45.7 forecast.