July 22, 2024

NAFTA talks: Canada to stand firm despite Trump’s warnings

LQDFX news blog: NAFTA talks: Canada to stand firm despite Trump’s warnings

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Following last Friday’s deadlock NAFTA talks resume. Canada will not give up easily despite the US President’s threats to exclude Ottawa from the trade Agreement and proceed with Mexico.

There was a bilateral agreement on new NAFTA terms between USA and Mexico last week. This deal temporarily boosted confidence that the trade war is gradually coming to an end, although the US-China dispute is alive. However, following the expiry of last Friday’s deadline Trump threatened to impose tariffs to Canada or leave their ally out of the deal.

Mexican President wanted to sign the pact before leaving office at the end of November, before his successor takes over.

The two sides failed to settle their differences last week. Among other, they argue over U.S. demands for more access to Canada’s closed dairy market. Canada’s Prime Minister stated on Tuesday: “There are a number of things we absolutely must see in a renegotiated NAFTA”.

Negotiators have “missed” several deadlines since the talks started in August 2017.

Back in June, Trump had offered Canada and Mexico a permanent exemption from the steel and aluminum tariffs if they agreed to U.S. demands on NAFTA.

Further, U.S. and EU trade chiefs will hold a first meeting in Brussels on Monday to pursue closer transatlantic ties. The initiative for the working group comes after Trump agreed to refrain from imposing tariffs on EU cars in July.

Trade disputes affect investors’ sentiment and have been their main concern since the beginning of 2018.START TRADING

Forex Market

The Dollar traded higher against its major traded rivals amid trade concerns which turned traders’ interest to the greenback. The dollar index inched up 0.1%.

The Australian Dollar, which had been at its weakest levels since mid-2016, rose 0.3% after Australia posted its best economic growth in 6 years.

The Euro fell 0.1% against the US Dollar.

The Sterling dropped 0.2% against the US dollar amid Brexit concerns in a fifth day of losses. The pound edged down 0.2% against the single currency as well.

Oil prices traded lower as the risk of a storm hitting US Gulf coast eased. The prices were supported by worries over lower supply and US sanctions over Iran.  Brent crude futures were 1.02 dollars down a barrel, while U.S. crude futures dropped 1.05$ from their last close.

Sources: Reuters, CNN money, BBC

PLEASE NOTE The information above is not investment advice.