FX.co ★ Canada Unemployment Rate Inches Up as Expected

Canada’s unemployment rate edged up to 6.5% in September 2026 from 6.4% in August, a two-year low, matching market expectations. The rate remained below its two-year average, a period marked by a slowdown in the Canadian economy amid the Bank of Canada’s aggressive interest rate hikes and elevated inflation.

The number of unemployed people increased by 15,400 to 1.475 million, even as the labor force participation rate fell by 0.2 percentage points to 64.8%—its lowest level since 1997, excluding the initial COVID-19 shock. Among core-aged workers, the unemployment rate for women rose by 0.3 percentage points to 5.3%, offsetting a 0.2 percentage point decline for men, to 5.8%.

The uptick in the headline unemployment rate coincided with an unexpected net employment decline of 68,300 jobs, in contrast to forecasts that had pointed to a modest increase in employment.