Canadian greenback positive aspects 0.2% in opposition to the buck
Trades in a spread of 1.4407 to 1.4520
Two-year yield hits practically three-year low
TORONTO, March 4 – The Canadian greenback clawed again a few of its latest declines in opposition to its U.S. counterpart on Tuesday because the buck posted broad-based losses and buyers doubted that hefty U.S. tariffs on Canadian items could be sustained.
The loonie was buying and selling 0.2% larger at 1.4450 per U.S. greenback, or 69.20 U.S. cents, after buying and selling in a spread of 1.4407 to 1.4520. On Monday, the forex posted its seventh straight day of declines and hit a one-month intraday low of 1.4541. U.S. President Donald Trump’s new 25% tariffs on imports from Mexico and Canada took impact, together with a doubling of duties on Chinese language items to twenty%, launching new commerce conflicts with the highest three U.S. buying and selling companions.
Canadian Prime Minister Justin Trudeau mentioned Ottawa would reply with 25% tariffs on C$30 billion ($20.7 billion) value of U.S. imports, and one other C$125 billion if Trump’s tariffs have been nonetheless in place in 21 days.
“The CAD has actually priced in some tariff threat in latest weeks however not 25%, so worth motion is a bit shocking,” Shaun Osborne, chief forex strategist at Scotiabank, mentioned in a be aware. “Value motion suggests maybe that markets are skeptical that 25% tariffs will stay in place for too lengthy.” The U.S. greenback fell to a three-month low in opposition to a basket of main currencies on issues about slowing development and the affect from tariffs on the U.S. financial system, whereas the worth of oil, one in all Canada’s main exports, was buying and selling 0.8% decrease at $67.80 a barrel following reviews that OPEC will proceed with a deliberate output improve in April.
Canadian bond yields have been combined throughout a steeper curve as buyers priced in a roughly 80% probability that the Financial institution of Canada would lower rates of interest additional on March 12. The two-year was down 2 foundation factors at 2.457%, its lowest stage since April 2022. (Reporting by Fergal Smith; Enhancing by Paul Simao)
