Loonie's Aussie Conundrum: Trade Tensions Reveal Hidden Weakness
The Canadian dollar has maintained its strength against the US currency since Donald Trump's presidency in January 2025, defying expectations of major weakness due to trade tensions. However, a closer look at the loonie's performance against the Australian dollar tells a different story.
According to data from LSEG, the Australian dollar has climbed to 0.9979 against the Canadian dollar, its highest level in five and a half years. This trend could indicate a larger drop for the loonie if it surpasses the February 2021 peak of 0.9993.
Reaching parity with the Aussie would be a significant development, as large round numbers can often slow or accelerate market moves. If the aussie breaks through this level, it could open the way to previous highs around 1.02 and 1.04.