The Canadian dollar weakened following a tweet from FOX Business White House correspondent Edward Lawrencethat President Donald Trump spoke with Canadian Prime Minister Mark Carney about additional tariffs Washington is preparing to impose on Canada.
According to Lawrence, a White House official confirmed that Trump and Carney spoke last night, with the discussion focused on the retaliatory tariffs planned by the US administration. The official reportedly said that the conversation produced no resolution that would prompt Trump to delay the measures, which are scheduled to take effect at 12:01 a.m. on August 19.
The report added to concerns that the two countries remain unable to reach an agreement ahead of the deadline. Markets had been watching the latest discussions for signs that the tariff measures could be postponed or softened, making the absence of a breakthrough particularly relevant for the Canadian dollar and the Bank of Canada.
The tariff threat is particularly significant because the measures announced by Washington include 50% tariffs on a broad range of Canadian goods, with the new duties scheduled to take effect on August 19. Tariff concerns also led traders to reduce expectations for Bank of Canada rate hikes, adding another source of pressure on CAD.
The key question is now whether last-minute negotiations can produce a deal before the deadline. A postponement or agreement could provide relief for the Canadian dollar, while the implementation of the tariffs without a compromise would likely keep trade uncertainty elevated.
This article was written by Giuseppe Dellamotta at investinglive.com.