Published: Thu, January 11, 2018
World | By Melba Underwood

Railroad Stocks Sink After Canada Sees NAFTA Risks Rising

Railroad Stocks Sink After Canada Sees NAFTA Risks Rising

Meanwhile, a Mexican government source told the aforementioned news agency that "we have always said that this is a possibility", referring to a possible United States exit from NAFTA.

The loonie fell to trade down 0.8 percent against its US counterpart. The next round of NAFTA negotiations is set to begin later this month in Canada.

But trade disputes have broken out between Canada and the US, the most recent involving USA imposed duties against Canadian newsprint imports Wednesday.

Any of the three countries can pull out of NAFTA if they give six months' notice, but the agreement remains in effect.

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Two officials, who made the remarks on condition of anonymity, said the government felt that chances of Trump's pullout were now above 50 percent.

The Canadian and Mexican currencies both weakened against the US dollar after Reuters broke the news.

Reports of NAFTA's possible demise, meanwhile, sent the Canadian and Mexican currencies tumbling, and the United States dollar rising from Can$1.2432 at 1200 GMT to Can$1.2554 at around 2030 GMT. The loonie bounced back late in the trading day after government officials on both sides of the border suggested there was no immediate change in Trump's NAFTA position. In a separate interview with Agri-Pulse, Trump said: "I'm negotiating tough for the farmers".

Trump withdrawing from Nafta “was always a risk, but that risk is clearly more elevated now, ” said Brian DePratto, senior economist at Toronto-Dominion Bank. U.S. Trade Representative Robert Lighthizer called that a “broad and ill-advised attack.”. They also express doubt whether the U.S. Congress would approve such a move.

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