Canadian Dollar Rises to Four-Month High Before Nafta Deadline

The Canadian dollar touched its strongest level since May as the U.S. and Canada held last-minute talks to update Nafta ahead of a deadline on Sunday.

The loonie strengthened 0.5 percent to C$1.2847, paring its 2018 decline to 2.4 percent. U.S. and Canadian negotiators are attempting to update the text of the trade agreement by midnight, White House trade adviser Peter Navarro said. The Mexican peso gained about 0.2 percent.

While the U.S. and Mexico have reached a trade accord, sticking points such as dispute panels and access to dairy markets have stymied U.S.-Canada progress. President Donald Trump has threatened auto tariffs if a deal can’t be reached.

“I’m not entirely sure anyone was expecting a deal before this deadline, so it’s not too surprising” to see the Canadian dollar rallying, said Viraj Patel, a currency analyst at ING.

The Canadian dollar also got a boost from a report that Royal Dutch Shell Plc and its four partners have agreed to invest in a multibillion-dollar liquefied natural gas project in western Canada. The deal would mark the nation’s largest infrastructure project ever.