Canadian Dollar Weakens Toward 6-Month Lows

2025-10-24 15:29 By Felipe Alarcon 1 min. read

The Canadian dollar weakened past C$1.40 per US dollar, slipping toward six-month lows as markets priced a near-certain 25bp Bank of Canada cut and Washington’s abrupt termination of trade talks raised the prospect of tariffs and weaker exports.

That trade setback increases the likelihood that tariff and sectoral frictions will squeeze business investment and export revenues, depressing growth and nudging the BoC toward further easing to offset those effects.

Markets now assign a high probability to a 25bp cut at next week’s meeting after a run of soft domestic activity and survey readings, which has pushed down expected Canadian short rates and narrowed the yield cushion versus the United States.

At the same time US inflation printed slightly softer-than-expected readings for September, firming expectations for Fed easing.



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