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The single currency is under pressure to strike a trading deal with former Commonwealth nations. This was amid the increased efforts of the United Kingdom to reintegrate Australia, Canada, and New Zealand back to the country. These countries were among the first economies t expressed their interest in signing a post-Brexit trade agreement. This was in spite of having an existing trading deal with the European Union. A proposed CANZUK (Canada-Australia-New Zealand-United Kingdom) is also on the rise following a looming withdrawal of Britain from the bloc. The United Kingdom is set to leave the bloc in 15 days and there is no sign of stopping British PM Boris Johnson’s agenda. Johnson won the Conservative party leadership, which led to him replacing Theresa May as the British Prime Minister. The UK highlighted that New Zealand was its top priority for a trading deal in a post-Brexit United Kingdom.
The Canadian Dollar’s demand is high five (5) days before Canada is set to have its federal election. The strength comes amid the weaker possibility of incumbent Prime Minister Justin Trudeau winning a reelection bid. Trudeau was accused of poor handling of the banning of China with Canadian exports. China banned exports from the country after Canada was pressured by the Trump administration to arrest Huawei’s CFO. Aside from this, Canada’s relationship with the Kingdom of Saudi Arabia enters to a new low during Trudeau’s term. The Canadian PM was also involved in a scandal which are deemed by analysts as illegal based on Canada’s constitution. Trudeau, together with his senior aides, pressured then Justice Minister to drop cases against SNC-Lavalin. On the other news, Canada is weighing possibility of signing a post-Brexit trade agreement with the United Kingdom.
The Canadian Dollar will continue to experience some weakness in the following days. This was following the report by the Global Competitiveness Index. According to the data published, Canada slipped to 14th place after sliding two (2) spots. Switzerland also slipped by one (1) spot to the 5th place. The data suggests that Canada’s economy was struggling to find its competitive edge. This was following the inability of the country to solve its relationship issues with China and Saudi Arabia. Aside from this, the country was particularly hit by the ongoing trade war between the United States and China. Switzerland, on the other hand, was able to weigh down economic and political uncertainty bought by the U.S.-China trade war. Switzerland was the first country to sign a trading deal with China’s Belt and Road Initiative. It is also engaging trade talks with the United Kingdom for a post-Brexit trade agreement.
The Japanese Yen is on the rise with Japan recently signing a trading deal with the United States. The deal is historical following the withdrawal of the U.S. from the pacific rim trade pact. The signed agreement also comes at a time of economic and political uncertainty across the world. Japan ratified the CPTPP (Comprehensive and Progressive Trans-Pacific Partnership). The country, together with the EU, created the largest trading zone in the world with the ratified EU-Japan deal. Chinese Vice President Wang Qishan will attend the enthronement ceremony of Japanese Emperor Naruhito. This is seen by political analysts as an ongoing deepening relationship with the second and third largest economies in the world. New Zealand, who is seen as an alternative to Australia, failed to weigh down the country’s economic uncertainty. This was despite talks by the country with President Donald Trump and President Xi Jinping.