The G20 summit was held this weekend in Germany, bringing together various finance ministers and central bank governors, who tried put their wisdom to work to help out the world economy. In a sign of the times given the current context and things to come, the statement does not make any mention of a shared determination to resist a protectionist approach. This is hardly surprising, given that last Friday, President Trump hinted that his administration would take aim at the trade policies of certain partners that it deemed unfair. President Trump’s diplomatic savvy was on full display for all to see when he refused to shake German Chancellor Angela Merkel’s hand.
Closer to home, Canadian Finance Minister Bill Morneau took the opportunity to repeat his commitment to reduce Canada’s debt ratio. All indications are therefore pointing to our government attempting to avoid adding to the deficit when it tables the federal budget on Wednesday.
Given this environment, the greenback is down this morning against its major peers, albeit with no major conviction. We may have to wait until Thursday for markets to establish a direction when Federal Reserve Chair Janet Yellen will have the opportunity, if she chooses to do so, to clarify her intentions regarding rate hikes.
