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USD/CAD - Canadian Dollar Edges Lower Ahead Of GDP

Mar. 02, 2018 8:50 AM ETUUP, UDN, FXC1 Comment
Dean Popplewell profile picture
Dean Popplewell

By Kenny Fisher

The Canadian dollar has posted slight losses in the Friday session. Currently, USD/CAD is trading at 1.2859, up 0.17% on the day. On the release front, Canada releases GDP, with the markets braced for a negligible gain of 0.1%. The US publishes UoM Consumer Sentiment, which is expected to jump to 99.4 points.

Global stock markets are seeing red on Friday, after US President Trump announced that he would be imposing stiff tariffs on steel and aluminum, in order to protect domestic producers. Under the new scheme, foreign steel will be taxed at 25% and aluminum at 10%. The response to the move was overwhelmingly negative, both abroad and in the US. China, Canada and the EU immediately denounced the move.

US auto makers and oil and gas producers also condemned the tariffs, saying they could get caught in the middle of a nasty trade war if other countries retaliate. In imposing the tariffs, Trump relied on a provision, which allows such measures for national security, but clearly, US trading partners will not quietly accept these protectionist measures.

Canadian policymakers continue to look with growing alarm at protectionist moves by the Trump administration. Negotiations on NAFTA have not shown much progress, as a seventh and final round of talks are underway in Mexico City.

As if the headache of a possible blowup of NAFTA wasn't bad enough, the Canadian government has to deal with the stiff imports that President Trump is set to apply to steel and aluminum imports. With some 80% of Canadian exports heading south to the US, Canada can ill afford a trade war with its giant neighbor. Still, the government will be under pressure to respond forcefully and stand up for its domestic steel industry.

The Bank of Canada is one of many

This article was written by

Dean Popplewell profile picture
Dean Popplewell has nearly two decades of experience trading currencies and fixed income instruments. He has a deep understanding of market fundamentals and the impact of global events on capital markets. He is respected among professional traders for his skilled analysis and career history as global head of trading for firms such as Scotia Capital and BMO Nesbitt Burns. Since joining OANDA in 2006, Dean has played an instrumental role in driving awareness of the forex market as an emerging asset class for retail investors, as well as providing expert counsel to a number of internal teams on how to best serve clients and industry stakeholders.

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Comments (1)

pdtor profile picture
Thank God we have Trudope negociating for Canada. I feel better. No, wait I mean worse, I am Canadian. See successful India trip.
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