Canadian and US negotiators are meeting in Washington for a third round of talks, racing to hand Donald Trump a path to a trade deal as early as Monday. USD/CAD keeps drifting lower, nearing a 50% retracement of its May-June rally as traders wait on the outcome.
Canada's Trade Minister Dominic LeBlanc sat down with US Trade Representative Jamieson Greer in Washington today, their third face-to-face meeting as both sides push toward an agreement. CBC reports that LeBlanc and Greer are aiming to present Trump a path to a potential deal as early as Monday, citing unnamed sources.
The urgency traces back to an August 19 deadline, when 50% tariffs are set to hit hundreds of Canadian imports, while the US applies similar tariffs on other countries. Beyond simply dodging that hit, Canada wants relief on steel, aluminum, lumber and autos. Notably, lumber has entered the list in this latest report, after being absent from earlier ones. Other reports have suggested Canada could pursue a mix of lower tariffs and quotas on steel and aluminum, whose tariff rates currently sit at 50%, a level that has crippled the Canadian steel industry.
USD/CAD has seen steady selling since the big May-June runup and is now nearing a 50% retracement of that move.
A quality deal that brings certainty to both the tariff dispute and the USMCA trade pact would give the loonie a big tailwind. But in Trump's world, that remains a big ask.
Source: InvestingLive
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