Canadian dollar hits two-and-a-half-week low as U.S. tariffs loom

Published 01/04/2025, 10:04
© Reuters.

Investing.com -- The Canadian dollar has hit a two-and-a-half-week low against the U.S. dollar with the prospect of impending reciprocal tariffs from the U.S. looming. The announcement of these tariffs is expected to be made by President Trump at 1500 EST on Wednesday.

Analysts from Monex Europe noted that speculative bets against the Canadian dollar, in comparison to the U.S. dollar, are currently the market’s favored foreign exchange expression for tariff concerns.

Despite this, they highlighted that the Canadian dollar is still far from the lows it reached earlier this year when tariff risks were perceived as most severe.

The analysts also pointed out that, considering the possibility of larger tariff increases than what the markets are currently prepared for, the Canadian dollar could face additional losses in the upcoming days.

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