Canada Lost 68,000 Jobs. The Futures Market Still Prices a Hike by December.
Canada lost 68,000 jobs in September, and Canada’s own futures market took 4.7 basis points off the December 9 Bank of Canada decision. The same contracts still carry four-fifths of a quarter-point increase by that date, which would take the target from 2.25% to 2.50%.
Three dated readings of the same contracts tell it. On the October 2 settlement, Montreal Exchange one-month CORRA futures priced 25.1 basis points of increase into December 9. On Thursday October 8, at about 3:15 p.m. ET, the December line was quoted at 25.2. On Friday October 9, the session that opened with the Labour Force Survey at 08:30 ET, it settled at 20.4. The move happened between Thursday mid-afternoon and Friday’s settlement.
The two figures either side of the report are both settlements, which is the only basis on which the comparison means anything. Thursday’s is a quote taken inside the week, not a third settlement, and the week into the report reads as unchanged. Quotes on these contracts are not fine enough to call a tenth of a basis point: the October contract was 97.7000 bid against 97.7075 ask, three quarters of a basis point wide, and December carried no two-sided quote at all.
All three readings are the same contracts solved on the same measured basis, with the gap between CORRA and the 2.25% policy target measured at +4.47 basis points over September 2026 rather than assumed (Bank of Canada data as of October 13, 2026). The October 2 reading is not a recollection: we published it at the time, in our October 4 reading of the December increase priced into Canadian futures.
| Reading | October 28 | December 9 |
|---|---|---|
| Oct 2 settlement | 2.3253% (+7.5 bp) | 2.5005% (+25.1 bp) |
| Oct 9 settlement | 2.3053% (+5.5 bp) | 2.4536% (+20.4 bp) |
| Change | -2.0 bp | -4.7 bp |
Increase priced into each Bank of Canada announcement, in basis points above the 2.25% target. Our solve on Montreal Exchange one-month CORRA futures (COA), net of the CORRA-to-target basis measured at 4.47 basis points over September 2026. The October 8 reading is intraday quotes, not a settlement.
What that price sits on is worth stating. The December contract settled at 97.5400, an implied average CORRA of 2.4600% across the month, which is 2.4153% once the measured basis comes off. The decision falls on December 9, so eight days of that month run at the post-October level of 2.3053%, and solving the remaining twenty-three gives 2.4536%, or 20.4 basis points above target. Open interest behind that is 422 contracts, with 626 on November and 10 on January, and on Tuesday morning, with the Canadian market closed Monday for Thanksgiving, every month showed zero volume and no net change. That is how we know these are Friday’s settlement prices rather than Tuesday’s, and it is also how thin the market is that produced a 4.7 basis point move.
Converting a price into odds requires an assumption, so here is ours stated plainly. If the only two outcomes on the table are a hold and a quarter-point increase, then +20.4 basis points is 81% weight on an increase by December 9, and +5.5 basis points is 22% on October 28. That is an arithmetic restatement of where the two sides cleared under a two-outcome assumption, not a poll of anybody.
The labour force shrank alongside employment
Our own arithmetic on the seasonally adjusted levels in Statistics Canada table 14-10-0287, from the September Labour Force Survey released Friday at 08:30 ET, shows where the 68,000 went.
| Month | Employment | Labour force | Unemployed | Unemployment rate |
|---|---|---|---|---|
| Jul 2026 | 21,214.8 | 22,669.4 | 1,454.7 | 6.4% |
| Aug 2026 | 21,173.1 | 22,632.6 | 1,459.5 | 6.4% |
| Sep 2026 | 21,104.8 | 22,579.7 | 1,474.9 | 6.5% |
Levels are in thousands. Employment fell 68.3, the count of unemployed rose only 15.4, and the labour force shrank 52.9. The three foot exactly, and that is why a 68,000-job loss moved the unemployment rate by a single tenth, from 6.4% to 6.5%. On September 2, Governing Council described the labour market as still soft, “with the unemployment rate around 6½% and subdued wage growth”. The headline was a shock. The rate the Bank quotes was not.
At 6.5%, the September rate is back where it sat in June, before the step down to 6.4% in July that the Bank cited in its September 2 press release. What the 68,000 was made of, by industry and province, is in Friday’s September jobs report.
The size of the fall is still unusual. Across all 120 monthly changes in the decade to September 2026, six were larger: two in 2020, two in 2021, January 2022, and February 2026’s 83.9, which makes September the largest monthly fall since.
Most of the priced move sits in December, not in three weeks
Only 5.5 basis points of increase is priced into the October 28 announcement, against 20.4 into December 9, so the step the market has paid for is the one after next.
October 19 is the next day that can move the line
Two readings land that Monday, according to the Bank’s calendar of upcoming events. September CPI arrives at 08:30 ET, and at 11:30 the Bank publishes its own Business Outlook Survey and Canadian Survey of Consumer Expectations. The Business Outlook Survey asks firms about their pricing intentions, which is the pass-through question put to the people who would do the passing through. For the shape of the last inflation report there is our report on August CPI. Governor Macklem speaks in Bangkok on October 14 and Senior Deputy Governor Rogers on October 15, both before any of it. The decision itself is Wednesday October 28 at 09:45 ET, with a Monetary Policy Report. Until then the December line stands at 20.4 basis points.
Disclaimer: The content on bestcanadianstocks.ca is for informational and entertainment purposes only and does not constitute financial advice. Past performance is not indicative of future results. Always consult a qualified financial advisor before making investment decisions. The priced Bank of Canada path is our own solve on Montreal Exchange one-month CORRA futures (COA) settlement prices, net of the CORRA-to-target basis measured at +4.47 basis points over September 2026 from Bank of Canada Valet series AVG.INTWO and V39079. The October 9 settlements were read on October 13, 2026 before the Canadian market reopened after Thanksgiving, with zero volume and zero net change on every contract month. The October 2 settlement figures are our own reading published on October 4, 2026. The October 8 figures are intraday quotes taken at about 3:15 p.m. ET, not a settlement. Employment, labour force, unemployment level and unemployment rate are Statistics Canada table 14-10-0287, seasonally adjusted, vectors v2062811, v2062810, v2062814 and v2062815 via the StatCan Web Data Service, pulled October 13, 2026; the decomposition and the 120-month placement are our arithmetic on those levels. Bank of Canada quotations are from the September 2, 2026 Summary of Governing Council deliberations and the September 2, 2026 press release. The October 19 and October 28 schedule is from the Bank of Canada calendar of upcoming events, retrieved October 13, 2026.
