Not afraid of Trump threats to tear up the NAFTA currency experts fear this

President Trump (Donald Trump) threatens to tear up long-term trade agreements with neighbouring countries, leading to the Mexican peso and the Canadian terror disturbed, some currency strategists, Trump talks of is "vanity". Donald Trump on Wednesday (23rd) in Phoenix, Arizona (Phoenix) said at a rally, even if will make government operations closed, make sure to get $16 billion of funds in the United States-Mexico border wall, also expressed his personal opinion that the North American free trade agreement (NAFTA) could unravel.

Us debt has reached $20 trillion now, Trump risk operation shut down the Government also insisted on funding the construction of the wall, made investors skittish, leading stocks closed yesterday black, Congress is expected to launch a new session will be held on September 5, will discuss whether to raise the debt ceiling to avoid default. United States with Mexico and Canada the negotiations are still ongoing, Donald Trump is to support an audience, "I think we may terminate the NAFTA agreement". Dollar against the Mexican peso on Wednesday (23rd) in political speech under the support of up to 17.8455, but later retreated to 17.7112.

Similarly, the highest in the US dollar against the Canadian dollar touched 1.2599, Canada later recovered to a decline from 1.2555. Despite these protectionist policies the center of Cannon sound sharp to speak, but the currency rebounded, perhaps also stressed that the claims of some analysts, that NAFTA does not disappear so quickly.

And the main reason is, the North American neighbors cannot afford the cost of losing the trade deal. NAFTA was signed on December 8, 1993, Christian Lawrence, Rabobank senior currency strategist thinks NAFTA supply chain interwoven so deep, cannot easily be "untied", so any implementation of border tax adjustment might come back to hurt American businesses.

Mexico's trade deficit with the United States came from auto sales, and Canada is associated with the oil and gas industry. RBC Global Asset Management Chief Economist Eric Lascelles said at this stage of fierce argument and will extend trade talks. He referred to the TPP trade agreements and EU-Canada comprehensive economic and trade agreement (CETA) are considerable delays of protracted war model of trade.

The negotiation drags on, the longer currency fluctuations may be more frequent. Eric Lascelles at the same time that a deal is likely to end up cracking up, "because the gap between different views of each other, coupled with unrealistic that a deal can be reached by the end of the. Everyone must recognize no agreement was reached, could pose a severe risk.

" But Lawrence believes that Canada is relatively more stable, relatively low risk because its trade with the United States, as the Bank of Canada (Bank of Canada) step in normalizing monetary policy on track, the Canadian economy has recently been improved. However, Mexico will not be so lucky, and NAFTA negotiations probably will collide with Mexico's presidential campaign season started strong, or currency fluctuations will make more raised news, "any of the candidates issued statements against the United States, are likely to Trump Twitter attack. "