The loonie in free fall (and it could get worse with Trump)

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• Start of the list The loonie in free fall (and it could get worse with Trump) of 7 elements. Skip the list?

  • The loonie in free fall (and it could get worse with Trump)

    PHOTO : Reuters / Brendan McDermid

  • 0,72 $ US

    This is the value of the Canadian currency at the close of markets on Friday, down more than 3% for a month.

  • Why this decline?

    Because the US dollar is rising. The currency is rising as markets anticipate a re-election of Donald Trump.

    PHOTO : Reuters / Shannon Stapleton

  • And how would his re-election strengthen the US dollar?

    • Donald Trump promises 10% tariffs on imports to the United States.
    • These tariffs therefore make imported products more expensive.
    • These increases protect the local economy, but influence international trade.
    • In response, the value of the US dollar increases to balance trade.

    Source: Hendrix Vachon, Senior Economist at Desjardins

  • 2,5 %

    This is the estimated increase in the US dollar if tariffs of 10% are applied, according to an International Monetary Fund (IMF) scenario cited by Hendrix Vachon, senior economist at Desjardins.

  • 0,70 $ US

    In the event of Donald Trump’s victory, the Canadian dollar could therefore continue its free fall to US$0.70, according to the IMF scenario. Conversely, the election of Kamala Harris would produce limited effects. Experts predict increased volatility in the dollar until the results are announced, especially if they take time to be confirmed.

  • What is the impact of a weaker Canadian dollar?

    • Boosting exports
    • Attractiveness for foreign investors
    • Inflation on imported products
    • More expensive foreign trips
    • Increase in debts in foreign currencies

  End of the list The loonie in free fall (and it could get worse with Trump) of 7 elements. Return to top of list?

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