The Canadian dollar strengthened to 1.38 per USD in late August, approaching a three-month high, as renewed pressure on the US dollar weighed on the greenback. Softer US inflation readings have raised expectations that the Federal Reserve may cut rates sooner than anticipated, reducing demand for the dollar and boosting the loonie. Elevated crude oil prices near multi-month highs have also benefited Canada as a major energy exporter by improving terms of trade. Canadian and US negotiators are meeting to finalize a deal that could ease months of tariffs and counter-tariffs. Canadian bond yields rose across the curve, tracking higher US Treasury yields.