Canada's Economic Challenge: Rising Unemployment Amid Tariff Strain

Canada's unemployment rate rose to 6.9% in April due to tariffs imposed by the U.S., reaching an eight-year high. Job growth was minimal, with increased unemployment and a struggling manufacturing sector. The Bank of Canada indicated potential economic strategies, while currency markets respond to labor reports.

Canada's unemployment rate has surged to 6.9% as of April, according to new data from Statistics Canada. This marks a troubling return to levels last seen outside of pandemic conditions in November, driven in part by U.S. tariffs on Canadian imports.

The nation's employment landscape remains largely stagnant, with a modest net gain of just 7,400 jobs in April. This is a stark contrast to the prior month's loss of 32,600 jobs. Despite analyst predictions of a 2,500 person increase and a slight uptick in unemployment to 6.8%, the figures underscore the economic headwinds facing Canada.

Particularly hard hit by U.S. tariffs on steel, aluminum, and vehicles, Canada's manufacturing sector is shedding jobs at an alarming rate, with 31,000 positions lost in April alone. Amid these challenges, the Bank of Canada has warned of potential economic slowdown, pledging decisive action if necessary.

(With inputs from agencies.)