Canadian dollar trading at multi-year lows versus USD following Trump victory

The Canadian dollar is trading at multi-year lows against the United States dollar following Donald Trump’s election victory.

The loonie was trending lower since around the beginning of October, but has dropped even further since the Nov. 5 election.

The Canadian dollar traded for 71.29 cents US Thursday compared with 71.53 cents US on Wednesday.

In contrast, in May 2021, the Canadian dollar traded for around 83 cents US.

It’s 52-week high stands at nearly 76 cents US.

And it doesn’t appear that the loonie will be recovering anytime soon.

“The trajectory is weaker given that Trump will be in the White House, which is a negative for Canadian exporters/business investment due to trade policy uncertainty,” said Katherine Judge, the director and senior economist at CIBC capital markets.

“And we are now likely to see a wider gap between the fed funds rate and the BoC’s overnight rate.”

CIBC has published an updated forecast through December 2026, which shows the loonie hovering in the 0.71 to 0.73 range compared to the US dollar.

However, the Canadian dollar has gained some ground compared to the Euro and Pound sterling in recent days as those currencies saw even more significant drops compared to the US dollar since Nov. 5.

See the CIBC foreign exchange rate forecast below, and click here for additional information.

— With a file from The Canadian Press