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Home / Business / The Canadian dollar hits a week low as the NAFTA trade agreement remains difficult to reach

The Canadian dollar hits a week low as the NAFTA trade agreement remains difficult to reach



The Canadian dollar weakened to a weekly low against its US counterpart on Friday as investor optimism softened that an agreement to recast the NAFTA trade pact would be reached.

At 15:56. EDT, the Canadian dollar, traded 0.5 percent lower at $ 1.3050 for the dollar, or $ 76.63. The Canadian currency also reached its weakest intraday reading since August 24 at $ 1,33089.

The mood of talks between Ottawa and Washington to update the North American Free Trade Agreement was clouded by President Donald Trump's comments that a pact would be on US While Canada was staunch against signing "just any deal".

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US Sales Representative Robert Lighthizer said in a statement that US officials would hold talks with their Canadian counterparts next Wednesday with the aim of reaching a deal signed by all three countries could.

Canadian Foreign Minister Chrystia Freeland was scheduled to hold a press conference at 4.30 pm to discuss the talks. EDT.

"It appears that the market praises the optimism it had earlier in the week," said Bipan Rai, Executive Director and North America Head, FX Strategy at CIBC Capital Markets.

Tuesday's loonie hit C $ 1.2887 – the strongest level in nearly three months – as investors bet that a deadline would be reached by Friday. For the week, it was on the way to drop 0.2 percent.

Canada sends about 75 percent of its exports to the United States, so its economy could be violated if a deal is not reached.

Data on Thursday showed that the Canadian economy expanded at the fastest rate of a year in the second quarter as exports rose, but the improved growth is unlikely to trigger a rate hike next week by the Bank of Canada.

The price of oil, one of Canada's key exports, fell as fears over the effects of a trade war hit sentiment. US crude oil futures fell 0.6 percent to $ 69.80 a barrel.

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Speculators have cut bearish bets on the Canadian dollar, data from the US Commodity Futures Trading Commission and Reuters calculations showed. On August 29, net short positions declined from 27,021 a week ago to 24,789 contracts.

Canadian government bond prices were higher over a flatter yield curve, while 10-year rising 38 Canadian cents reached 2.288 percent. The 10-year yield reached its lowest daily level on July 25, at 2.218 percent.


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