Canadian Dollar Slumps as Tariff Deadline Looms

The US and Canada are locked in last-minute negotiations over tariffs, which has put pressure on the Canadian dollar. The Trump administration's planned 50% tariffs on Canadian imports are set to take effect on August 19 without a breakthrough or postponement. This comes as US President Donald Trump stated that there are no talks or negotiations with Iran currently taking place or scheduled.

On the economic front, the ADP weekly NER pulse rose to 9.50K in July, beating expectations of 8.25K prior. However, this was offset by weaker data from US housing starts, which fell to an annualized 1.239 million in July, down 12.4% from June and 13.5% from a year earlier.

The Canadian dollar weakened as markets continued to price the risk of US tariffs taking effect, but it eventually bounced towards the end of the session after a report suggested that Trump was weighing whether to grant Canada a tariff reprieve.