Canadian dollar drops sharply as Trump threatens new tariffs on trade partners

The Canadian dollar fell sharply after former President Donald Trump threatened a 25% tariff on Canada and Mexico, along with an additional 10% on China. This announcement caused the US dollar to rise significantly against major currencies. In early trading, USD/CAD surged from around 1.3975 to 1.4175 before stabilizing near 1.4100. Other commodity currencies, including the Australian and New Zealand dollars, also experienced declines against the US dollar. Market reactions followed Trump's tweet, which contrasted with earlier expectations that his new Treasury secretary would moderate his trade policies. The Bank of Canada and other central banks are also in focus as they prepare for upcoming meetings.