The Canadian dollar is experiencing losses against the US dollar, primarily due to weak domestic economic data and persistent structural issues. In the fourth quarter of 2024, Canada’s trade deficit widened to CAD 5 billion, marking the tenth consecutive quarter of deficit despite an uptick in exports driven by metals and energy products. As trade tensions with the US continue, concerns about the economy's future stability increase, particularly with significant risks tied to deteriorating trade relations. Additionally, strong US economic indicators are impacting market sentiments and expectations for Canadian monetary policy.
The Canadian dollar continues to weaken as structural economic challenges persist amidst increasing trade deficits and pressure from a resilient US economy.
Canada's widening trade deficit reflects ongoing structural issues, with significant implications for the economy as trade tensions with the US continue to loom large.
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