- October 10, 2025
- Posted by: Melanie Scott
- Category: Market News
September’s Canadian employment data came in much stronger than expected, with a net gain of 60.4K jobs versus expectations of just 2.8K, keeping the unemployment rate steady at 7.1% rather than rising to the predicted 7.2%. While Friday’s figures are a welcome surprise, markets remain cautious about interpreting them as a sign of recovery given the substantial job losses seen in July and August. Overall, significant slack persists in the labour market, which could justify further rate cuts from the Bank of Canada. However, Friday’s strength in employment may delay the timing of such moves, particularly if upcoming inflation data also comes in stronger than expected.
The preliminary University of Michigan Consumer Sentiment Index for October slipped slightly to 55.0 from 55.1 in September, a smaller decline than the expected 54.1. On an annual basis, sentiment is down roughly 22%. Year-ahead inflation expectations eased modestly to 4.6% from 4.7%, while long-run expectations held steady at 3.7%, levels that remain elevated and largely influenced by tariff-related uncertainty earlier this year.
On Friday, President Trump threatened a “massive increase” in tariffs on Chinese imports following China’s new export controls on rare-earth materials. He also stated there is “no reason” to meet with President Xi Jinping as previously planned, suggesting their upcoming summit could be canceled. The announcement unsettled markets, pushing the U.S. dollar index (DXY) down 0.38% from Thursday’s close.
After surpassing the USD 4,000 mark earlier in the week, gold prices are now projected to reach USD 4,500 in 2026 and remain near that level through 2027, supported by expectations of persistent long-term inflation.
Oil prices declined following a ceasefire agreement between Israel and Hamas, which reduced the geopolitical “risk premium” that had recently boosted energy markets. Oil has now fallen below USD 60 per barrel, down more than 4% from yesterday’s close.
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