FX.co ★ Canadian Dollar Strengthens Further

The Canadian dollar edged closer to $1.41, approaching its recent four-month high on April 3rd, buoyed by domestic measures and a generally weaker U.S. dollar. President Trump's recent decision to pause reciprocal tariffs for 90 days—excluding China, where tariffs have surged to 125%—has eased broad trade tensions, weakening the dollar and consequently increasing the attractiveness of the Canadian loonie. In Canada, the rapid implementation of a 25% counter tariff on vehicles not compliant with USMCA, starting April 9, has safeguarded essential export sectors and strengthened trade expectations, thereby boosting investor confidence. Moreover, the recovery in crude oil prices, spurred by an improved demand outlook in the energy markets, has further supported Canada’s export-dependent economy.