empty
05.03.2025 01:30 PM
USD/CAD: The Pair Declines Amid the Implementation of Trump's New Tariffs

This image is no longer relevant

For the second consecutive day, USD/CAD continues its downward movement. The U.S. dollar remains under pressure due to growing concerns about an economic slowdown, fueled by the impact of new tariffs imposed by Donald Trump. On Tuesday, Trump's 25% tariffs on Canadian and Mexican goods officially took effect, along with an increase in tariffs on Chinese imports to 20%, adding further uncertainty to the market.

According to U.S. Commerce Secretary Howard Lutnick, in an interview with Fox News, Trump may reconsider his tariff policy within 48 hours of its implementation, which could provide some relief, provided that USMCA conditions are met. However, the New York Times reports that Trump has privately expressed his intention to keep the tariffs in place, creating additional risks for the market.

The U.S. Dollar Index, which measures the dollar's value against a basket of six major currencies, has been declining for the third consecutive day. Market sentiment continues to weigh on the greenback amid speculation that Trump may ease his stance on tariffs.

This image is no longer relevant

Key Economic Data to Watch Today

Investors should pay close attention to the ISM Services PMI and the ADP Employment Report, both scheduled for release during the North American trading session.

The Canadian dollar also faces downside risks, which limits further losses in USD/CAD. Expectations for additional rate cuts by the Bank of Canada (BoC) are increasing. According to Reuters, markets have already priced in an 80% probability of a rate cut by the BoC next week.

BMO Chief Economist Douglas Porter noted that the expected quarter-point rate reduction is likely to continue for the next four meetings until July, bringing the key rate down to 2.0%.

Market Outlook and Technical Factors

Additionally, as the Canadian dollar is closely tied to oil prices, the recent decline in crude oil also acts as a limiting factor for further USD/CAD downside movement.

From a technical perspective, despite the U.S. dollar's decline against the Canadian dollar, oscillators on the daily chart remain in positive territory, indicating that further downside pressure may be limited in the near term.

Irina Yanina,
Analytical expert of InstaForex
© 2007-2025
Select timeframe
5
min
15
min
30
min
1
hour
4
hours
1
day
1
week
Earn on cryptocurrency rate changes with InstaForex
Download MetaTrader 4 and open your first trade
  • Grand Choice
    Contest by
    InstaForex
    InstaForex always strives to help you
    fulfill your biggest dreams.
    JOIN CONTEST

Recommended Stories

The ECB May Cut Interest Rates Twice

The euro is showing a sharp rally against the U.S. dollar. The EUR/USD pair has already reached a three-year high and shows no signs of slowing down. Meanwhile, according

Jakub Novak 12:42 2025-04-11 UTC+2

AUD/USD. Analysis and Forecast

The AUD/USD pair is attempting to attract buyers in its rebound from the psychological level of 0.5900, marking its lowest point since March 2020. The upward momentum has managed

Irina Yanina 12:39 2025-04-11 UTC+2

Markets Face a Prolonged Period of Instability (USD/JPY and USD/CHF Likely to Continue Falling)

On Thursday, investors realized there is currently no such thing as stability. High market volatility remains and will continue to dominate for some time. The ongoing cause of this remains

Pati Gani 09:11 2025-04-11 UTC+2

The Market Has Grown Used to Chaos

What is life if not a game? In past years, investors focused on the standoff between the Federal Reserve and financial markets. But in 2025, the rules of the game

Marek Petkovich 08:42 2025-04-11 UTC+2

What to Pay Attention to on April 11? A Breakdown of Fundamental Events for Beginners

A relatively large number of macroeconomic events are scheduled for Friday, but none are expected to impact the market. Of course, we may see short-term reactions to individual reports

Paolo Greco 06:04 2025-04-11 UTC+2

GBP/USD Overview. April 11: The Market Didn't Believe Trump

The GBP/USD currency pair also traded higher on Thursday. As a reminder, macroeconomic and traditional fundamental factors currently have little to no influence on currency movements. The only thing that

Paolo Greco 03:28 2025-04-11 UTC+2

EUR/USD Overview. April 11: The American Comedy Continues

The EUR/USD currency pair declined sharply overnight on Wednesday but showed some recovery during the day. On Thursday, there was further growth—this series of fluctuations can only be described

Paolo Greco 03:28 2025-04-11 UTC+2

Trading Recommendations and Analysis for GBP/USD on April 11: The Dollar Takes a Double Hit

The GBP/USD currency pair also showed strong growth on Thursday, although not as strong as the EUR/USD pair. The pound gained only around 200 pips—which isn't a considerable move under

Paolo Greco 03:28 2025-04-11 UTC+2

EUR/USD. A Message from the Past: U.S. CPI Report Fails to Support the Dollar

The CPI report released on Thursday showed weaker-than-expected inflation. The market responded accordingly: the U.S. dollar came under renewed pressure (the U.S. Dollar Index fell into the 100.00 range)

Irina Manzenko 00:47 2025-04-11 UTC+2

The Euro Charges Ahead. Opponents Retreat

A rally in European stock indices, slowing U.S. inflation, and the fact that the average U.S. tariff has not changed significantly despite the 90-day deferral all contributed to the rise

Marek Petkovich 00:47 2025-04-11 UTC+2
Can't speak right now?
Ask your question in the chat.
Widget callback
 

Dear visitor,

Your IP address shows that you are currently located in the USA. If you are a resident of the United States, you are prohibited from using the services of InstaFintech Group including online trading, online transfers, deposit/withdrawal of funds, etc.

If you think you are seeing this message by mistake and your location is not the US, kindly proceed to the website. Otherwise, you must leave the website in order to comply with government restrictions.

Why does your IP address show your location as the USA?

  • - you are using a VPN provided by a hosting company based in the United States;
  • - your IP does not have proper WHOIS records;
  • - an error occurred in the WHOIS geolocation database.

Please confirm whether you are a US resident or not by clicking the relevant button below. If you choose the wrong option, being a US resident, you will not be able to open an account with InstaForex anyway.

We are sorry for any inconvenience caused by this message.