CAD Weaker After Lumber Comments from Trump

The Canadian dollar fell to a 14-month low and the Mexican peso was under pressure, after the U.S. slapped tariffs on the Canadian lumber industry, sparking fears the U.S. will get tougher on trade with the neighbors on its northern and southern borders.



However, analysts say the fears appear overblown since the U.S.-Canadian dispute over soft lumber dates back to the 1980s and has previously involved tariffs. They also say this is not an indication of broader protectionism that markets had feared could come from the Trump administration.

The Canadian dollar fell nearly 1 percent against the U.S. dollar, while the peso was down more than 1.2 percent.

The action also comes as the U.S., Mexico and Canada are planning to begin renegotiating the North American Free Trade Agreement, which has been called unfair by President Donald Trump. Created in the early 1990s, the deal fostered the development of a large and complicated North American supply chain, especially between the U.S. and Mexico.

via CNBC

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza