Canada’s new tariffs on $27.6 billion of US goods weigh on USD/CAD as trade tensions escalate and the USD weakens.
USD/CAD declined to 1.3834 on Tuesday, pressured by Canada’s retaliatory tariffs on $27.6 billion worth of US imports. The duties, ranging from 15% to 50%, target 700 products and take effect September 8, following US tariffs on Canadian goods after failed trade talks.
The move reinforces a bearish outlook for the pair, with the USD struggling amid renewed debasement concerns. The US Treasury’s plan to increase buybacks of longer-dated securities has further dampened demand for the Greenback.
Technical indicators support the downside, with USD/CAD holding below key resistance levels, including the 200-day SMA at 1.3843 and a broader resistance zone near 1.4057.