Forex
US-Canada Trade Dispute Ignites, But CAD Stays Afloat on Oil Price Surge
The US-Canada trade dispute has escalated significantly in recent days, with Ottawa implementing retaliatory tariffs and Washington imposing import bans on selected Canadian goods.
The new measures are economically modest, affecting single-digit billions of dollars annually, and have been well telegraphed by both sides for months. As a result, the Canadian dollar (CAD) has barely budged against the US dollar (USD), with USD/CAD holding steady near 1.38.
A key factor in the CAD's resilience is the ongoing surge in oil prices, which have pushed Brent to around $100 per barrel and are currently providing a much larger immediate counterweight than the trade restrictions.