Canadian dollar approaches nine-year low on tariff threats

The Canadian dollar dropped sharply past 1.44 per USD, nearing the nine-year high of 1.45 hit on January 17th, following the first wave of executive orders from US President Trump that weighed on the outlook for Canadian foreign exchange inflows.

Canadian dollar approaches nine-year low on tariff threats

Trump announced plans to impose tariffs of up to 25% on Canada by February 1st, citing the rising number of illegal border crossings as the rationale for the measure. This move would significantly reduce demand from Canada’s largest export market, putting pressure on dollar inflows into the country.

Trump's moves hits CAD

Additionally, Trump’s push to boost domestic energy production further impacted Canada’s energy exports to the US, forcing Canadian energy producers to lower their selling prices. Meanwhile, markets are anticipating further rate cuts from the Bank of Canada this year to address growth concerns.