USD/CAD approaches multi-week lows at 1.3670 amid growing trade uncertainty

Later

• The US Dollar extends losses for the third day in a row, as trade concerns grow.
• Investors are increasingly wary of the potential impact of higher import costs on the US economy.
• Later today, Fed Powell will speak amid increasing pressures from the government to resign.
  

The US Dollar extends its reversal against the Canadian Dollar for the third consecutive day on Tuesday, and is approaching 10-day lows at the 1.3670 area, amid broad-based USD weakness as concerns about tariffs grow.

The Greenback is depreciating against most peers on Tuesday, with investors increasingly wary about the potential impact of Trump's tariffs on the US economy. The August 1 deadline approaches, and there are no significant advances in the trade negotiations with key partners such as the European Union or Japan.

Fed Powell speaks amid increasing pressures to resign

The calendar is void today, but later on the day Fed Powell will speak at an economic event in Washington. The Fed Chairman is not expected to speak about monetary policy as the bank is on the blackout that precedes every interest rate decision, but he might defend the bank's independence in the face of unprecedented attacks from the Government.

Rumours about the possibility that Trump fires Powell seem to have abated, although the US President has kept calling for his resignation and some lawmakers are accusing him of fraud due to overrun costs of the bank headquarters' renovation.

The Canadian Dollar, on the other hand, might struggle to rally further with Crude prices depressed near 1, ½ month lows. Crude Oil is Canada´s main export, and the deteriorating outlook for global demand, amid restricted trade activity, will, sooner or later, harm the Canadian Dollar.