The Canadian dollar clawed back much of its decline against its U.S. counterpart on Monday as investors weighed the possibility of Canada achieving a reprieve from U.S. tariffs, with the currency rebounding from an earlier 22-year low.

The US administration has de facto scrapped the USMCA agreement that President Donald Trump himself had negotiated in 2019, as tariffs were imposed on Canada, Mexico this weekend. You can find our economics team’s initial thoughts on US tariffs here. In this note, we'll be focusing on Canada.