Bill Morneau resigned as federal Finance Minister in a surprise move. The reasons are not entirely clear and it is somewhat perplexing that the Minister would resign in the middle of an economic crisis. It is now widely reported that Chrystia Freeland will become the new Finance Minister. The markets will view her appointment as a signal of continuity, though she is viewed as less friendly to and familiar with business interests. The ultimate impact of this change on the market’s perception of the Canadian dollar remains to be seen. More immediately, Walmart and Home Depot reported much stronger than expected earnings which has fueled the already prevailing narrative that the consumer has weathered the crisis in reasonable shape and that a v-shaped recovery is in progress. The markets reacted as expected to this risk-on mood with the US dollar trading down broadly and the Canadian dollar up 0.4% against the US currency as of this morning.
