Loonie Steady After Trudeau Government Re-elected

The Canadian dollar held near a three-month high on Tuesday as the market took in stride the election outcome of a Liberal minority government.

Prime Minister Justin Trudeau’s Liberals will form a minority government after a tight election on Monday, with the latest tally from Elections Canada showing Liberals had won or were leading in 155 out of 338 seats.

A minority government leaves Trudeau in a weakened position and needing the support of a party such as the New Democrats (NDP) to push through key legislation.

The Canadian dollar responded to the news by trading nearly unchanged at $1.3082 to the U.S. dollar. The currency, which was boosted on Monday by signs of progress toward a resolution of the trade dispute between the United States and China, notched its strongest intraday level since July 22 at $1.3071.

Canada’s dollar has been the top-performing G10 currency this year, up more than 4% against the U.S. dollar.