The USD/CAD pair relinquished intraday gains, stabilizing near 1.3860 during North American trading hours on Thursday, as the US Dollar’s (USD) recovery diminished. This retreat occurred despite President Trump’s assertions of progress in bilateral trade negotiations with Japan and Mexico. The US Dollar Index (DXY) experienced a slight decline from its intraday peak of 99.60, settling near 99.45. President Trump communicated positive developments in trade discussions via a Truth.Social post. Concurrently, the Bank of Canada (BoC) maintained its interest rate at 2.75% on Wednesday, issuing a cautionary statement regarding the potential for a protracted global trade conflict to precipitate a significant economic downturn. While the BoC refrained from publishing an economic forecast, it presented alternative scenarios reflecting the uncertainty surrounding the impact of US tariff policies on the Canadian economic landscape.
