USD/CAD COLLAPSES TO FRESH 2025 LOWS BELOW 1.3800
USD/CAD COLLAPSES TO FRESH 2025 LOWS BELOW 1.3800
The US Dollar (USD) experienced a significant drop during European trading hours, primarily due to escalating trade tensions between the United States and China.
In response to the White House's recent decision to impose tariffs on Chinese imports at a rate of 145%, China announced it would raise its retaliatory tariffs on US goods to 125%, effective Saturday.
The heightened trade tensions led to a sharp depreciation of the USD against the Canadian Dollar (CAD), causing the USDCAD currency pair to fall below the 1.3800 mark, reaching new lows for 2025.
Investors adopted a risk-off approach, moving away from USD-denominated assets, including US Treasury bonds, in favor of safer alternatives.
This shift contributed to the USD's decline and the CAD's relative strength.
On April 10, 2025, the White House confirmed the implementation of tariffs on Chinese imports at a rate of 145%, higher than the previously estimated 125%.
This decision further exacerbated market volatility and fueled concerns over a potential trade war.
China indicated that it would not continue matching further US tariff increases, suggesting that at current tariff levels, American imports are no longer economically viable in the Chinese market.
