It’s been a rollercoaster ride for loonie this week as Trump Administration put the Northern neighbor trough the wringer, first slapping tariffs on soft lumber, then threatening to pull out of NAFTA. Adding insult to injury has been the lackluster performance of oil as crude slipped below the $50/bbl level.

Tomorrow’s Canadian GDP report may be another hit to the pair if it misses rather modest expectations of 0.1% growth versus 0.6% the month prior. With Canadian real estate market in a massive bubble and the country’s banking sector in a credit crunch due to deteriorating loan quality, the loonie may be in for more pain.

Given the Trump Administration’s penchant for protectionism, it is not at all certain if further flare-ups will be in store and loonie remains vulnerable for the time being. USD/CAD has breached the top of its range and unless the pair comes back below the 1.3400 mark the near term trend suggests that the pair could push towards 1.4000 over the near term horizon.