Canada Dollar Crumbles as Ottawa and Washington Head for Trade War

Trade tensions between Canada and the US have escalated after Ottawa and Washington failed to reach an agreement, leading to a decline in the Canadian dollar. The US imposed a 50% tariff on $20 billion worth of imports from Canada, its second-largest trading partner.

The affected goods include dairy products, wine, wood products, ceramics, and other items. In response, Canadian Prime Minister Mark Carney announced that Canada would retaliate with tariffs starting September 8, targeting sectors such as steel, dairy, agricultural equipment, paper, and electronics.

The breakdown in talks has raised concerns of a full-blown trade war between the two nations. The Canadian dollar fell on Monday morning following the news.