CAD: The resurgent Liberals - ING

The Canadian Dollar (CAD) remains quite soft given the threat of tariffs, ING's FX analysts Chris Turner notes.

The next move in the CAD is probably lower

"These could come for any number of reasons. And the renegotiation of the USMCA looks like a difficult proposition where the stated aim from Washington now seems to be restricting Canada and Mexico's access to third markets, i.e. China. This looks to be a difficult negotiation and one where Washington will use the big stick of tariffs as a threat."

"The backlash against Washington's policies in Canada has seen resurgent support for the Liberal party as it stands up to the tariff threat. Politicians around the world might be inspired by the Liberals to stand and fight. This could lead to more pricing of a global trade war, which is bad news for the commodities complex."

"The next move in the Canadian dollar is probably lower from here, with 1.4250/4280 now the near-term base."