Loonie limps toward worst week since September as Canada sheds 4,700 jobs

The loonie is limping through its roughest week since September, and Canada's job market is to blame. Employment shrank by 4,700 jobs in October, according to Bloomberg Markets, the third straight month of losses. The unemployment rate ticked higher, landing at 6.7% — the loftiest reading since April.

Traders wasted no time repricing the Bank of Canada's next move. Prediction markets now put a 71% chance on the central bank standing pat, up from 62% a day earlier. Bets on a 25 basis point hike slid, now sitting at 30% after being 37% the day before.

That swing tells the story: a labor market that keeps shedding jobs makes aggressive tightening a harder sell. The softness in Canadian employment has become the dominant variable in how markets read the central bank's appetite for another move.

Nobody is calling it a done deal. The Bank of Canada's next rate announcement, set for December 9, 2026, is the next big checkpoint for anyone positioning around the loonie. Officials' commentary and incoming data between now and then could easily shift the odds again.

For now, the takeaway is blunt: weak jobs, a wobbling currency, and a central bank that markets increasingly expect to sit still. The week's damage to the Canadian dollar is the clearest scoreboard of that mood.