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OTTAWA — In the space of just two months, two of Canada’s key sectors have fallen flat or gotten worse.

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Real estate and financial services now account for 20 per cent of Canada’s economy — and with debt at record levels, that could be a problem.





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More bluntly, the labour market has caved and there doesn’t appear to be much daylight ahead. As for the much-delayed export recovery, don’t hold your breath.

Statistics Canada delivered a double whammy of data on Friday that showed a deteriorating employment picture in July — and a higher jobless rate— along witha widening trade gap a month earlier that produced a record deficit as exports declined.

“It’s a bit of a gruesome twosome,” said Douglas Porter, chief economist at BMO Capital Markets. “No question, both figures were notably weaker than expected.”

The Canadian dollar fell after the two reports were released. At midday Friday, the currency was down US0.92 cents to US75.87 cents.