USD/CAD weakens to near 1.4250, FOMC Minutes in focus

USD/CAD softens to near 1.4255 in Tuesday’s late American session. 

Trump said there is no pause on tariffs but is open to negotiations. 

Investors await the release of the FOMC Minutes later on Wednesday.

The USD/CAD pair edges lower to around 1.4255 during the late American session on Tuesday. The Canadian Dollar (CAD) strengthens against the Greenback as investors weigh the prospect of negotiations globally over US trade tariffs. The FOMC Minutes will be in the spotlight later on Wednesday. Also, the Federal Reserve (Fed) Thomas Barkin is set to speak. 

US Customs and Border Protection said on Tuesday that it is prepared to begin collecting country-specific tariffs from 86 US trade partners. Trump noted that he wasn’t considering a pause on his plan to implement sweeping additional tariffs on dozens of countries despite contact from trade partners seeking to avoid the levies, but yet hinting he would be open to some negotiations

Trump's minimum 10% tariff on all imports to the US was introduced last week. He had also previously imposed 25% duties on goods from Mexico and Canada and a 10% tariff on Canadian energy imports. However, he then announced some exemptions and delays. The easing fears of trade tension between the US and Canada provide some support to the CAD. 

Meanwhile, a decline in Crude Oil prices could exert some selling pressure on the commodity-linked Loonie. It’s worth noting that Canada is the largest oil exporter to the US, and lower crude oil prices tend to have a negative impact on the CAD value.