Canada’s September jobs report has added complexity to the Bank of Canada’s upcoming interest rate decision on October 28. Statistics Canada revealed a loss of 68,000 jobs, following another decline in August, which could ease inflation pressure but also make loan repayments more challenging for borrowers.
The unemployment rate rose to 6.5%, though a falling participation rate limited the increase. The job losses were widespread, affecting sectors like educational services, health care, and manufacturing, indicating broader economic weakness rather than a single industry downturn.
The Bank of Canada’s policy rate remains at 2.25%, with high energy costs and tariffs pushing in the opposite direction of weaker employment. For borrowers, a quarter-point rate change could mean roughly $104 more in monthly interest on a $500,000 balance, highlighting the importance of the rate decision without guaranteeing a cut.
Bank of Nova Scotia (TSX: BNS) reported a fiscal third-quarter adjusted return on equity of 14.2%, up from 12.4% a year earlier. The bank’s quarterly dividend stands at $1.14, offering an annualized yield of about 3.62% at the October 9 close of $126.03. However, investors must consider lending risks amid economic uncertainty.