A bill aimed at delaying President Trump's tariffs on foreign automobiles, introduced by Republican Senator Lamar Alexander and Democratic Senator Doug Jones on Wednesday, gave the Canadian dollar a boost in the second half of the New York Forex session.
In the hours following the unexpected news, currency traders pushed the USD/CAD pair to a low of 1.3031 - a gain of almost 0.80% for the CAD on the day. At press time, the CAD is trading at a 40-day high against the USD.
According to Bloomberg, the bill puts the brakes on Trump's bold 25% auto tariff hike until an independent U.S. International Trade Commission examines the impact the tariffs would have on the American car market.
And Canada's currency wasn't the only beneficiary the bipartisan bill. The Mexican peso also got a boost following the news, closing the day off with a gain of 1.10% vs. the USD. Wednesday's gains also pushed the peso to its highest level (18.66 pesos to the dollar) since May 1, 2018.
Image Credit: Carol Van Hook
