Canadian Dollar Hit Hardest as Trade Woes Resurface: Inside G-10
(Bloomberg) -- The Canadian dollar fell against all its major peers after U.S. President Donald Trump revoked his support for a joint Group-of-Seven statement and criticized his neighboring leader Justin Trudeau.
The U.S. dollar was steady as investors awaited a series of major risk events this week, including a summit between Trump and North Korean leader Kim Jong Un in Singapore on Tuesday and meetings of the world’s three-biggest central banks on following days. The Japanese yen halted a two-day winning streak.
“The Canadian dollar is facing selling pressures as the G-7 summit reinforced the confrontation between Canada and the U.S., particularly concerns about U.S. targeting automobile sector which is a huge blow for Canada,” said Ko Haruki, head of the financial solutions group at CIBC World Markets (Japan) in Tokyo. “CAD is also weighed by fundamentals after a weak employment report last week.”
“I have instructed our U.S. Reps not to endorse the Communique as we look at Tariffs on automobiles flooding the U.S. Market!,” Trump tweeted Saturday evening while en route to Singapore aboard Air Force One. Trump’s economic adviser Larry Kudlow said on CNN’s “State of the Union” Sunday the Canadians “stabbed us in the back.”
- USD/CAD climbed 0.3% to 1.2971 after rising as much as 0.6%; pair still below Friday’s high of 1.3039
- Bloomberg Dollar Spot Index little changed, while benchmark Treasury 10-year yield edged up 1bp to 2.96%
- USD/JPY at 109.77 versus 109.23-109.84 range
- “After the initial risk-off reaction earlier in Asia session, investors have calmed down a bit now to wait and see how the European and American players respond,” said Kumiko Ishikawa, a currency analyst at Sony Financial Holdings Inc. in Tokyo. “Investors are wary of building on selling positions just on the G-7 factor, given the upcoming U.S.-North Korea summit”
- AUD/USD up 0.1% at 0.7606; pair dropped as much as 0.4% to 0.7573 in early Asian trade before reversing losses; NZD/USD rose 0.1% to 0.7038
- EUR/USD climbed 0.2% to 1.1797
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