Canada's Labor Market Loses Momentum as Trade Tensions Rise

The Canadian economy's labor market lost its momentum in August, according to data released by Statistics Canada. The country shed a net 42,000 jobs last month, falling short of economists' expectations of a gain of 15,000 positions.

The unemployment rate remained steady at 6.4 percent, while the U.S. saw a burst of hiring, adding 162,000 jobs in August. The U.S. unemployment rate also held steady at 4.1 percent.

Canada's manufacturing sector led the gains among industries, with a net 22,000 new jobs created. However, employment declined across 11 of 16 sectors, including public administration and natural resources.

The weak jobs report suggests that the labor market may have been struggling before the latest tariff hit, said Royce Mendes, head of macro strategy at Desjardins Securities.