The Canadian dollar strengthened on Friday, reaching a summit of almost seven months against its American counterpart, while the prospect of a calm in global trade tensions stimulated the morale of investors as a meeting scheduled for next week between Canadian Prime Minister Mark Carney and President Donald Trump.
The “loonie” increased by 0.4 % to 1.38 for an American dollar, or 72.46 cents American, after having touched its strongest level in session since October 17 at 1.3761. Over the week, the currency also displayed an increase of 0.4 %.
Mark Carney said he would go to Washington next Tuesday for what he anticipates as “difficult but constructive” discussions with Donald Trump. Canada has sent around 75 % of its exports to the United States, including steel, aluminum and cars, which have been struck by significant American customs duties.
“The consequences of customs tariffs on economic activity in Canada and the possible Canadian government response concern operators,” said Darren Richardson, Operations Director at Richardson International Currency Exchange Inc.
-Canada Bank warns that a sustainable world trade war could lead to a significant recession in Canada. The Liberal Party of Carney, which retained power in the general elections on Monday, has promised to reduce taxes and increase expenditure in housing and infrastructure.
Signs of appeasement in trade tensions between the United States and China boosted Wall Street, while the US dollar has lost ground in the face of a basket of major currencies, despite positive figures on employment in the United States.
The price of oil, one of the main exports of Canada, fell 1.6 % to stand at US $ 58.29 per barrel, investors being cautious before an OPEC+ meeting intended to set the group’s production policy for June.
The yields of Canadian state bonds have progressed over the entire curve, following the trend of American treasury bills. The 10 -year rate earned 10 base points at 3.202 %.
