USD/CAD Jumps To Near 1.4430 As Investors Turn Cautious Ahead Of Trump’s Inauguration -

USD/CAD Jumps To Near 1.4430 As Investors Turn Cautious Ahead Of Trump’s Inauguration

Jan 17, 2025Jeremy ParkinsonFinance0

USD/CAD rises sharply to near 1.4430, with investors remaining cautious as Trump is set to return White House on Monday.

The outlook of the Canadian economy has weakened on the assumption that Trump will raise tariffs by 25%.

The soft core CPI data for December forced traders to raise Fed dovish bets.

The USD/CAD pair climbs to near 1.4430 in Friday’s North American session. The Loonie pair strengthens as the Canadian Dollar (CAD) performs weakly, with investors turning cautious as United States (US) President-elect Donald Trump is scheduled to take oath on Monday.
Canadian Dollar PRICE TodayThe table below shows the percentage change of Canadian Dollar (CAD) against listed major currencies today. Canadian Dollar was the strongest against the New Zealand Dollar.

USD EUR GBP JPY CAD AUD NZD CHF USD 0.06% 0.40% 0.25% 0.22% 0.43% 0.43% 0.16% EUR -0.06% 0.33% 0.19% 0.15% 0.36% 0.37% 0.09% GBP -0.40% -0.33% -0.15% -0.18% 0.03% 0.03% -0.24% JPY -0.25% -0.19% 0.15% -0.03% 0.17% 0.18% -0.10% CAD -0.22% -0.15% 0.18% 0.03% 0.20% 0.22% -0.06% AUD -0.43% -0.36% -0.03% -0.17% -0.20% 0.00% -0.27% NZD -0.43% -0.37% -0.03% -0.18% -0.22% -0.01% -0.28% CHF -0.16% -0.09% 0.24% 0.10% 0.06% 0.27% 0.28%

The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Canadian Dollar from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent CAD (base)/USD (quote).Investors expect that the foremost job of Trump would be the release of a new tariff plan, a scenario that could lead to a global trade war. The Canadian economy is expected to face a 2% increase in tariffs on its exports to the US, as mentioned by Trump earlier.Market participants expect large tariffs by the US on Canada could dampen their economic outlook. “If Canada gets hit with large tariffs and they don’t retaliate then the disinflationary effects would likely prompt considerably more easing by the Bank of Canada (BoC),” said Derek Holt, economists at Scotiabank said.The BoC was one of the leading central banks that eased policy restrictiveness aggressively. According to a January 10-16 period Reuters poll, the BoC is almost certain to cut interest rates by 25 basis points (bps) to 3%.Meanwhile, the US Dollar (USD) moves higher as investors digest might acceleration in traders’ bets supporting more than one interest rate cut by the Federal Reserve (Fed). The US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, rises to near 109.15.Fed dovish bets rose after the release of the US Consumer Price Index (CPI) report for December, which showed that the annual core inflation surprisingly decelerated.More By This Author:USD/JPY Bounces Back From Four-Week Low Of 156.00 As US Dollar Gains Ground EUR/USD Trades Cautiously As Focus Shifts To Trump’s Inauguration USD/CHF Price Forecast: Ticks Lower Despite Upbeat US Dollar

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