Canada tamps down worries about US NAFTA withdrawal
Jan 11 2018
Notice of withdrawal could also raise opposition in Congress.
"There's been chatter in the market going into this week that it was coming up", Quincy Krosby, chief market strategist at Prudential Financial in Newark, New Jersey. His negotiating team has set proposals that have alarmed their Canadian and Mexican counterparts.
In keeping with his campaign promise, Mr Trump forced Canada and Mexico to sit down and renegotiate the 1994 trade pact, and said if a deal could not be reached he would withdraw the United States from Nafta.
The Loonie closed at an average trading price of 80.03 cents USA, down 0.27 of a USA cent.
Talks between Mexico, Canada and the U.S. to renegotiate the terms of the North American Free Trade Agreement began in August previous year and are still underway, although concerns have been expressed by the United States at the lack of progress.
"Despite the uncertainty surrounding NAFTA and rumors Mexico wouldn't be able to continue exporting to the United States, it's important to note that not only did we hit a record in exports but we also had record export numbers to the United States with almost 10 percent growth", AMIA President Eduardo Solis said.
The Canadian dollar rose 4.2 cents to 0.79.74 USA dollar.
That's bad news for USA farmers, according to Jackson Takach, a Farmer Mac economist.
General Motors Co shares fell 2.4 percent.
The confusion over Canadian expectations come ahead of the next round of negotiations, scheduled to be held in Montreal Jan. 23-28. The Detroit automaker has 14 manufacturing facilities in Mexico, including one that builds large pickup trucks, among the automaker's most profitable vehicles.
"A Canadian government official pushed back against a Reuters report, calling it "inaccurate" that the Government of Canada is "convinced" the U.S will soon pull out of NAFTA".
"We're prepared for that possibility".
Mexico's Economy Ministry declined to comment on the report, a ministry spokesman said.
Canadian Foreign Affairs Minister Chrystia Freeland was in Washington to meet with senior USA lawmakers and Secretary of Commerce Wilbur Ross on Tuesday. Canada launched a wide-ranging trade complaint against the United States, the World Trade Organization said on Wednesday, in a dispute that Washington said would damage Canada's own interests and play into China's hands.