The Canadian dollar strengthens as US-Canada trade talks progress ahead of an August 19 tariff deadline, pressuring the pair.
The USD/CAD pair fell 0.32% to 1.3888, marking its lowest level in two months. The decline follows reports that US-Canada trade negotiations are advancing, with both sides aiming for an interim deal before an August 19 tariff deadline.
Earlier, the US Dollar Index (DXY) slipped 0.23% to 99.70, reflecting reduced expectations of a Federal Reserve rate hike in September. Analysts note improving US inflation trends but caution that price pressures remain above the Fed’s target.
Market sentiment suggests the Fed may maintain its current stance until clearer evidence of sustained inflation control emerges.