Saturday, September 5, 2026 A wild week wraps up with mixed signals: Canada's job market stumbled just as America's roared back, the TSX gave back some ground, and Tuesday brings a new round of retaliatory tariffs. Here's what actually matters for your wallet. 1. Canada Lost 42,000 Jobs in August — Unemployment Holds at 6.4% Statistics Canada's Labour Force Survey showed employment fell by 41,700 to 42,000 in August, a sharp reversal after July's 75,100-job surge and well short of the roughly 15,000-job gain economists expected. Full-time work took the biggest hit, down about 36,000, while the public sector shed jobs for a third straight month. Manufacturing was the lone bright spot, adding 22,000 positions. The unemployment rate held steady at 6.4% because the labour force shrank too, and wage growth cooled to just 2.0% year-over-year — the slowest pace since 2017 outside the pandemic. WHAT IT MEANS FOR YOU Slower wage growth means smaller raises are more likely ...
Are rate hikes over for Canada
The Canadian economy is expected to show a modest growth of 0.4% in the third quarter of 2023, according to the latest estimates from Statistics Canada. This is lower than the 0.6% expansion in the previous quarter, and well below the 2.1% growth rate that the Bank of Canada projected in July.
The weak GDP numbers have fueled the speculation that the country may be heading into a recession, as global trade tensions, lower oil prices, and household debt weigh on the economic outlook.
However, not everyone is convinced that the situation is so dire. Some forecasters argue that the third quarter slowdown was mainly due to temporary factors, such as a strike at a major auto plant, a drop in agricultural output due to drought, and a slowdown in housing construction. They expect that the economy will rebound in the fourth quarter, as these factors dissipate and consumer spending picks up.
Moreover, some forecasters point out that the inflation rate remains within the central bank's target range of 1% to 3%, suggesting that there is no need for further monetary stimulus. They also note that the labour market remains strong, with the unemployment rate at a near-record low of 5.5%, and wage growth at a solid 3.2%.
Therefore, some forecasters believe that the Bank of Canada will maintain its wait-and-see approach, and keep interest rates unchanged until there are clear signs of either a sustained recovery or a prolonged downturn. They argue that the central bank has already done enough to support the economy, by cutting interest rates three times in 2022, and that any further easing could fuel financial imbalances and inflationary pressures.
In summary, the GDP numbers for the third quarter of 2023 are likely to spark more debate about the state of the Canadian economy and the direction of monetary policy. However, some forecasters are more optimistic than others, and think that the rate hikes are over for now, unless there is a significant change in the economic conditions.
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